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Share Name | Share Symbol | Market | Type |
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AZZ Inc | NYSE:AZZ | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.80 | 1.08% | 75.02 | 76.075 | 74.08 | 75.62 | 410,113 | 01:00:00 |
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Filed by the Registrant
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Filed by a Party other than the Registrant
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Preliminary Proxy Statement
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CONFIDENTIAL, FOR USE OF THE COMMISSION ONLY (AS PERMITTED BY RULE 14a-6(e)(2))
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Definitive Proxy Statement
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Definitive Additional Materials
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Soliciting Material Pursuant to §.240.14a-12
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Payment of Filing Fee (Check the appropriate box):
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No fee required.
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Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
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(1)
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Title of each class of securities to which transaction applies:
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(2)
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Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11
(set forth the amount on which the filing fee is calculated and state how it was determined):
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(4)
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Proposed maximum aggregate value of transaction:
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(5)
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Total fee paid:
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Fee paid previously with preliminary materials.
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Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
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(1)
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Amount Previously Paid:
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(2)
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Form, Schedule or Registration Statement No.:
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(3)
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Filing Party:
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(4)
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Date Filed:
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Focused on enhancing our environmental, social and governance (“ESG”) programs and practices;
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Formed a Sustainability Council, led by the Company’s Chief Legal Officer, with members of the Council selected based on their knowledge of sustainability issues and cross-functional expertise in the AZZ business;
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Disclosed our ESG and sustainability principles within a newly created ESG microsite located on AZZ’s website;
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Amended our Nominating and Corporate Governance Committee Charter for the committee to provide oversite of the Company’s ESG policies and sustainability practices;
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Amended the Company’s Code of Conduct and Corporate Governance Guidelines to reflect the Company’s commitment to sustainability, diversity, equality and inclusion;
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Enhanced the leadership structure in each of the Company’s business segments to include a Chief Operating Officer;
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Restructured and enhanced the Company’s finance team focusing on continued improvement in the Company’s internal controls over financial reporting;
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Expanded the role of our Senior Vice President of Marketing to include investor relations and shareholder engagement, to regularly engage in active dialogue with our shareholders; and
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Retained external financial advisors to expedite the Board’s ongoing comprehensive review of our Company portfolio.
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TIME AND DATE:
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10:00 a.m., local time, July 13, 2021
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LOCATION:
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One Museum Place, 3100 West 7th Street, 4th Floor, Fort Worth, Texas 76107
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PROPOSALS:
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I.
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Elect the nine (9) director nominees named in the accompanying Proxy Statement to serve on the Company’s Board of Directors, each for a one-year term.
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II.
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Vote for an advisory approval of a non-binding resolution approving the Company’s executive compensation program.
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III.
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Vote for an advisory approval on determining the frequency of Say-on-Pay votes.
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IV.
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Vote for the ratification of the appointment of Grant Thornton LLP to serve as the Company’s independent registered public accounting firm for the fiscal year ending February 28, 2022.
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V.
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To transact any other business which may properly come before the Annual Meeting or any adjournment.
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RECORD DATE:
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You can attend and vote your shares at the Annual Meeting if you were a shareholder of record of the Company’s common stock at the close of business on May 14, 2021 (the “Record Date”).
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NOTICE:
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A Notice Regarding the Availability of Proxy Materials (the “Notice”) was mailed to shareholders on or about June 1, 2021.
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IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS
FOR THE 2021 ANNUAL MEETING OF SHAREHOLDERS
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AZZ’s Proxy Statement and Fiscal Year 2021 Annual Report are available at www.proxyvote.com
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VOTING:
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Your vote is very important. Even if you intend to be present at the Annual Meeting, please promptly vote in one of the following ways so that your shares may be represented and voted at the Annual Meeting:
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Call the toll-free telephone number shown in the instructions included on your Notice;
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Vote via the Internet on the website as described in the instructions included on your Notice; or
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If you receive a paper copy of the proxy materials, complete, sign, date, and return your proxy card or voting form.
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TABLE OF CONTENTS
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Page
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Date and Time
July 13, 2021, 10:00 a.m., local time
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Place
AZZ Inc., One Museum Place, 4th Floor,
3100 West 7th Street,
Fort Worth, Texas 76107
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Notice
We mailed a Notice Regarding the
Availability of Proxy Materials (the
“Notice”) on or about June 1, 2021.
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Voting
Holders of shares of common stock
as of the Record Date are entitled to vote
on all matters.
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Record Date
May 14, 2021
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Item
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Company Proposals
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Board Vote
Recommendation
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Page
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1.
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Election of nine (9) directors
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FOR each
director nominee
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2.
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Approval, on an advisory basis, of the Company’s executive compensation program
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FOR
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3.
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Advisory vote on determining the frequency of “Say-on-Pay” votes
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FOR 1 YEAR
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4.
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Ratification of the appointment of Grant Thornton, LLP to serve as the Company’s independent registered public accounting firm for the fiscal year ending February 28, 2022
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FOR
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How to Vote
You can vote by any of
the following methods:
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Internet (www.proxyvote.com) until 11:59 p.m. Eastern Time, on July 12, 2021;
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By Mail. Completing, signing and returning your proxy or voting instruction card before July 13, 2021; or
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Telephone (1-800-690-6903) until 11:59 p.m. Eastern Time, on July 12, 2021;
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In person, at the Annual Meeting, if you are a registered shareholder as of the Record Date. You may deliver a completed proxy card or vote by ballot at the meeting.
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1
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Proxy Statement
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✔
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Eight out of nine director nominees are independent
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Independent committee chairs and members
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Commitment to continuous board refreshment and diversity
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Separate chairman and Chief Executive Officer
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Annual election of all directors
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Regular executive sessions of independent directors
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✔
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Majority voting for directors
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Risk oversight by full board and committees
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Stock ownership guidelines for directors and officers
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✔
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Annual board and committee self-evaluations
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Name
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Age
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Director
Since
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Independent
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Nominating
and Corporate
Governance
Committee
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Audit
Committee
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Compensation
Committee
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Other
Public
Company
Boards
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Daniel E. Berce
President and Chief Executive Officer,
General Motors Financial Company
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67
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2000
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✔
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2
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Paul Eisman
Former President and Chief Executive Officer, Alon USA Energy, Inc.
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65
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2016
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✔
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—
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Daniel R. Feehan
Chairman of the Board, FirstCash, Inc.
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70
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2000
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✔
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2
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Thomas E. Ferguson
President and Chief Executive Officer, AZZ Inc.
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64
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2013
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—
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Clive A. Grannum
President, Performance Alloys and Composites, Materion Corporation
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55
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2021
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✔
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—
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Carol R. Jackson
President, Chief Executive Officer and Chairman of the Board, HarbisonWalker International
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49
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2021
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✔
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1
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Venita McCellon-Allen
Former President and Chief Operating Officer, Southwestern Electric Power Company
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61
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2016
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✔
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—
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Ed McGough
Senior Vice President, Global Manufacturing and Technical Operations, Alcon, Inc.
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60
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2017
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✔
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—
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Steven R. Purvis
Trustee and Portfolio Manager, Luther King Capital Management
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56
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2015
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✔
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—
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Chair
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Member
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2
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Proxy Statement
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Name
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Age
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Position
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Since
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Previous Position
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Thomas E. Ferguson
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64
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President and Chief Executive Officer
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2013
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Chief Executive Officer, FlexSteel Pipeline Technologies, Inc.
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Philip Schlom
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56
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Senior Vice President and Chief Financial Officer
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2020
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Interim Chief Financial Officer and Chief Accounting Officer, AZZ Inc.
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Tara D. Mackey
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51
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Chief Legal Officer and Secretary
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2014
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Chief Legal Counsel and Corporate Secretary, First Parts, Inc.
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Gary Hill
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56
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Chief Operating Officer – Infrastructure Solutions
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2020
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President and General Manager – Industrial Platform, AZZ Inc.
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Bryan Stovall
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56
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Chief Operating Officer – Metal Coatings
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2020
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President – AZZ Galvanizing Solutions, AZZ Inc.
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What We Do
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A significant portion of our executive officers’ total compensation is based on the Company’s performance and the payouts are contingent upon the attainment of certain pre-established performance metrics and capped to minimize risk.
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The compensation committee engages an independent executive compensation consultant.
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Performance measures are highly correlated to the creation of shareholder value.
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Our compensation committee conducts an annual review of all executive compensation program components to ensure alignment with our compensation objectives and the Company’s industry peers.
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We review and benchmark pay relative to the market median of our industry peer group on an annual basis.
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We implemented a Compensation Recovery Policy to protect the Company in the event of a financial restatement or an executive officer engages in serious misconduct.
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Our executive compensation program is designed to encourage building long-term shareholder value and attract and retain high performance executive talent.
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We provide a limited number of employment agreements and executive perquisites.
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We use annual cash incentive opportunities and equity-based awards to balance the Company’s short- and long-term performance objectives.
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We have stock ownership guidelines for directors and executive officers.
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Our equity awards are equally weighted between time-vested restricted stock units, which vest ratably over a three-year period, and performance share units, which require achievement of financial performance metrics over a three-year performance cycle.
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What We Don’t Do
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We do not provide tax gross ups.
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We do not pay dividends or dividend equivalents on unearned RSUs or PSUs until they vest.
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We do not recycle shares withheld for taxes.
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We do not reprice underwater equity awards.
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We do not permit pledging or hedging of Company securities.
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✘
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We do not have pension or supplemental executive retirement plans.
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3
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Proxy Statement
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Category
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Compensation Element
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Description
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Cash
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Base Salary
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Fixed cash compensation based upon experience and on responsibilities of the position. Reviewed annually for potential adjustments based on market rates for each position, individual performance and scope of responsibilities.
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Annual Incentive Opportunity
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Annual cash incentive for achievement of specific annual financial operating results and a qualitative component relating to managing operations and liquidity during a COVID disrupted year.
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Long-Term Incentives
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Restricted Stock Units
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Vest ratably over a three-year period. Settled in shares of AZZ common stock. Dividend equivalents accrue with respect to dividends awarded during the vesting period and will not be paid unless and until the underlying award vests.
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Performance Share Units
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Three-year pre-determined financial performance metric settled in shares of AZZ common stock. Dividend equivalents accrue during the vesting period and will vest if, and when the PSUs to which such dividend equivalents relate become vested.
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Retirement
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401(k) Plan
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Qualified 401(k) plan available to all U.S. employees. The Company matches 100% of the first 1% and 50% of contributions between 2% and 6% (with a potential total Company match of 3.5%).
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Other
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Employment Agreements
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Sets standard benefits for certain NEOs in the event of termination of employment from the Company.
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Severance Plan
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Sets standard benefit guidelines for executives in the event of severance and is available to all U.S. employees (except for NEOs with employment agreements).
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Change-in-Control Agreements
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Sets standard benefits for senior executives upon a change-in-control.
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Other Benefits
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Executive supplemental disability insurance, financial planning services and annual physical exam.
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4
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Proxy Statement
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This Proxy Statement for the Annual Meeting; and
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The Company’s Annual Report on Form 10-K for the fiscal year ended February 28, 2021, as filed with the Securities and Exchange Commission (the “SEC”) on April 23, 2021 (the “Annual Report”).
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The election of nine (9) nominees to the Company’s board of directors named in this Proxy Statement, each to serve for a one year term (Proposal 1);
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A non-binding advisory resolution to approve AZZ’s executive compensation program (Proposal 2);
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A non-binding advisory vote on determining the frequency of “Say-on-Pay” votes (Proposal 3); and
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Ratification of the appointment of Grant Thornton LLP to serve as AZZ’s independent registered public accounting firm for the fiscal year ending February 28, 2022 (Proposal 4).
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“FOR” the election of the nine (9) nominees to serve on the Board for a one year term (Proposal 1);
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“FOR” the approval of AZZ’s executive compensation program (Proposal 2);
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“FOR 1 Year” on the approval of the frequency of Say-on-Pay votes (Proposal 3); and
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“FOR” the ratification of the appointment of Grant Thornton LLP to serve as the Company’s independent registered public accounting firm for the fiscal year ending February 28, 2022 (Proposal 4).
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5
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Proxy Statement
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View the Company’s proxy materials for the Annual Meeting; and
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Instruct the Company to send future proxy materials to you by email.
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6
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Proxy Statement
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Are entitled to vote and you are present in person at the Annual Meeting; or
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Have properly voted by proxy on the Internet, by telephone or by submitting a proxy card by mail.
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Indicate when voting on the Internet or by telephone that you wish to vote as recommended by AZZ’s board of directors; or
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Sign and return a proxy card without giving specific voting instructions,
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7
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Proxy Statement
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Proposal
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Voting Requirement
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1. Election of nine (9) director nominees named in this Proxy
Statement, each for a one year term.
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Each director must be elected by a majority of the votes cast. A majority of votes cast means that the number of shares voted “FOR” a director must exceed the number of votes cast “AGAINST” that director. Any director not elected by a majority is expected to tender to the board his or her resignation promptly following the certification of election results pursuant to the Company’s Bylaws. The nominating and corporate governance committee will make a recommendation to the board on whether to accept or reject such resignation. The board will act on such recommendation and publicly disclose its decision within 90 days from the date of the certification of the election results.
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2. Approval, on a non-binding advisory basis, of the Company’s
executive compensation program.
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To be approved, this proposal must be approved by a majority of the votes cast by the shareholders present in person or represented by proxy, meaning that the votes cast by the shareholders “FOR” the approval of the proposal must exceed the number of votes cast “AGAINST” the approval of the proposal.
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3. Approval, on a non-binding advisory basis, the frequency of Say-
on-Pay votes.
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To be approved, this proposal must be approved by a majority of the votes cast by the shareholders present in person or represented by proxy, meaning that the frequency option (one year, two years or three years) that receives the greatest number of votes shall be passed.
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4. Ratification of the appointment of Grant Thornton LLP to serve as the Company’s independent registered public accounting firm
for fiscal year 2022.
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To be approved, this proposal must be approved by a majority of the votes cast by the shareholders present in person or represented by proxy, meaning that the votes cast by the shareholders “FOR” the approval of the proposal must exceed the number of votes cast “AGAINST” the approval of the proposal.
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8
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Proxy Statement
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As necessary to meet applicable legal requirements;
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To allow for the tabulation and certification of votes; and
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To facilitate a successful proxy solicitation.
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9
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Proxy Statement
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10
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Proxy Statement
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Proposal 1
Election of Directors
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Daniel E. Berce
Age: 67
Director Since: 2000
Serves as President and Chief Executive Officer of General Motors Financial Company, Inc.
Paul Eisman
Age: 65
Director Since: 2016
Formerly served as the President and Chief Executive Officer of Alon USA Energy, Inc.
Daniel R. Feehan
Age: 70
Director Since: 2000
Chairman of the Board Since: 2019
Serves as Chairman of the Board of FirstCash, Inc. and AZZ Inc.
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Thomas E. Ferguson
Age: 64
Director Since: 2019
Serves as President and Chief Executive Officer of AZZ Inc.
Clive A. Grannum
Age: 55
Director Since: 2021
Serves as President, Performance Alloys and Composites of Materion Corporation
Carol R. Jackson
Age: 49
Director Since: 2021
Serves as President, Chief Executive Officer and Chairman of the Board of HarbisonWalker International
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Venita McCellon – Allen
Age: 61
Director Since: 2016
Formerly served as the President and Chief Operating Officer of Southwestern Electric Power Company
Ed McGough
Age: 60
Director Since: 2017
Serves as the Senior Vice President of Manufacturing and Technical Operations at Alcon, Inc.
Steven R. Purvis
Age: 56
Director Since: 2015
Serves as a Principal of Luther King Capital Management
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11
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Proxy Statement
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THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE ELECTION OF EACH OF THE DIRECTOR NOMINEES LISTED BELOW.
|
|
|
12
|
Proxy Statement
|
|
| |
DANIEL E. BERCE
Age: 67
Director Since: 2000
Board Committees:
• Audit Committee (Chairman)
• Compensation Committee
|
| |
Daniel E. Berce serves as President and Chief Executive Officer of General Motors Financial Company, Inc. (formerly AmeriCredit Corp.) and has served in this capacity since its acquisition by General Motors Company in October 2010. Mr. Berce also served as AmeriCredit Corp.’s Chief Executive Officer from 2005 until 2010, President from 2003 until 2010 and Chief Financial Officer from 1990 until 2003. He served as a director of Americredit Corp. from 1990 to 2010. Before joining Americredit Corp., Mr. Berce was a partner with Coopers & Lybrand, an accounting firm. Mr. Berce currently serves as a director of FirstCash, Inc., a publicly held international operator of retail pawn stores in the U.S. and Latin America, and chairman of Arlington Asset Investment Corp., a publicly held investment firm investing primarily in mortgage-related assets.
We believe Mr. Berce’s qualifications to serve on the board of directors include his executive level leadership experience, his experience serving as a Chief Executive Officer of a publicly held company and as a director of multiple publicly held companies, as well as his knowledge of corporate governance, executive compensation, accounting and financial expertise.
|
|
|
| |
PAUL EISMAN
Age: 65 Director Since: 2016 Board Committees: • Audit Committee
• Nominating and Corporate
Governance Committee
|
| |
Paul Eisman formerly served as the President and Chief Executive Officer of Alon USA Energy, Inc. (“Alon”) and as a director and the President and Chief Executive Officer of Alon USA Partners, LP. He has more than 30 years of refining experience and executive level leadership expertise in refining production and retail business operations. Prior to joining Alon in 2010, Mr. Eisman served as Executive Vice President of Refining and Marketing Operations with Frontier Oil Corporation from 2006 to 2010. From 2003 to 2006, he served as Vice President of KBC Advanced Technologies, a leading consulting firm to the international refining industry. Mr. Eisman served as Senior Vice President, Planning for Valero Energy Corporation from 2001 to 2002. Mr. Eisman also served in various executive leadership roles at Diamond Shamrock Corporation from 1979 to 2001.
We believe Mr. Eisman’s qualifications to serve on the Company’s board of directors include his extensive experience in various executive leadership positions in refining production and retail business operations.
|
|
|
| |
DANIEL R. FEEHAN
Age: 70 Director Since: 2000 Chairman of the Board Since: 2019 Board Committees: • Compensation Committee
• Nominating and Corporate Governance Committee
(Chairman)
|
| |
Daniel R. Feehan serves as Chairman of the Board of FirstCash, Inc., a publicly held international operator of retail pawn stores in the U.S and Latin America. Previously, Mr. Feehan served as a director of Cash America International, Inc. (“Cash America”) since 1984 and was Cash America’s Executive Chairman from November 2015 until Cash America’s merger with First Cash Financial Services, Inc. (now FirstCash, Inc.) in September 2016. Prior to that, Mr. Feehan served as Chief Executive Officer of Cash America from 2000 to 2015 and as President from 2000 to 2015. From 1990 to 2000, he served as President and Chief Operating Officer of Cash America. Mr. Feehan also currently serves as a director of Enova International Inc., a publicly held leading provider of online financial services to non-prime consumers and small businesses.
We believe Mr. Feehan's qualifications to serve on the Company’s board of directors include his executive level leadership experience and ability to provide direction and oversight to the Company's financial reporting and business controls, specifically his experience as a Chief Executive Officer of a publicly held company, experience in finance, accounting, strategic planning and experience serving as a director of multiple publicly held companies.
|
|
|
13
|
Proxy Statement
|
|
| |
THOMAS E. FERGUSON
Age: 64
Director Since: 2013
Board Committees:
• None
|
| |
Thomas E. Ferguson serves as a non-independent director and as the Company’s President and Chief Executive Officer. Prior to joining AZZ, he was a consultant and served as interim Chief Executive Officer of FlexSteel Pipeline Technologies, Inc., a provider of pipeline technology products and services in 2013. Mr. Ferguson has also served in various executive level leadership roles with Flowserve Corporation, a publicly held global provider of fluid motion and control products, including Senior Vice President from 2006 to 2010, as President of Flow Solutions Group from 2010 to 2012, as President of Flowserve Pump Division from 2003 to 2009, as President of Flow Solutions Division from 2000 to 2002, as Vice President and General Manager of Flow Solutions Division North America from 1999 to 2000 and as Vice President of Marketing and Technology for Flow Solutions Division from 1997 to 1999. Mr. Ferguson retired from Flowserve Corporation in 2012.
We believe Mr. Ferguson’s qualifications to serve on the Company’s board of directors include his considerable global business and leadership experience serving as an executive officer of a public company, his domestic and international strategic experience both in the industries in which AZZ operates, and his track record for helping businesses achieve exponential growth, both organically and through acquisitions in the global marketplace.
|
|
|
| |
CLIVE A. GRANNUM
Age: 55
Director Since: 2021
Board Committees:
• Audit Committee
• Compensation Committee
|
| |
Clive A. Grannum has served as President, Performance Alloys and Composites of Materion Corporation, a leading advanced materials supplier, since 2018. Prior to joining Materion, Mr. Grannum served as Corporate Vice President, Corporate Officer and President – Global Chlorinated Organics at Olin Corporation, a global manufacturer and distributor of chemical products, from 2015 to 2016. Prior to joining Olin, Mr. Grannum held a number of senior leadership roles at Dow Chemical Company, including President, Global Chlorinated Organics and SAFECHEM from 2014 to 2015; Global Managing Director, Plastics Additives, Global Chlorinated Organics and SAFECHEM from 2011 to 2014; and Vice President, Corporate Officer and Global Business Director, Plastics Additives from 2008 to 2011. Prior to joining Dow Chemical, he served as the Vice President of Plastic Additives for Rohm and Haas Company, a global specialty chemical producer, from 2007 to 2008. Prior to Rohm and Haas, Mr. Grannum held multiple roles of increasing responsibility at The ICI Group and The BOC Group, with his last roles being Senior Vice President, Uniqema Americas at ICI from 2001-2006 and Vice President and Global General Manager-Packaged Systems at BOC from 1999 to 2001. Mr. Grannum also currently serves as a director on the Boards of the Boys and Girls Clubs of Greater Saint Louis, an organization devoted to inspiring and enabling youth to reach their full potential, and MediNova N.Y., a non-profit organization that provides medical services free of charge to underprivileged communities.
We believe Mr. Grannum’s qualifications to serve on the Company’s board of directors include his considerable executive leadership experience, experience in global manufacturing and strategic mergers and acquisitions, business development, process improvement, financial experience and transformational growth in manufacturing based industries.
|
|
|
14
|
Proxy Statement
|
|
| |
CAROL R. JACKSON
Age: 49 Director Since: 2021 Board Committees: • Compensation Committee
• Nominating and Corporate
Governance Committee
|
| |
Carol R. Jackson has served as President, Chief Executive Officer and Chairman of the Board of HarbisonWalker International, the largest supplier of ceramic refractories in the U.S. with operations in the U.S., Canada, Mexico, Europe, and Southeast Asia and commercial interests globally, since 2017 and served as Corporate Officer, Senior Vice President and General Manager from 2014 to 2017. Prior to joining HarbisonWalker, Ms. Jackson served as Corporate Officer, Vice President and General Manager of Carpenter Technology Corporation, a global leader in the development, manufacture, and distribution of cast/wrought and powder metal stainless steels and specialty alloys from 2011 to 2013. Prior to joining Carpenter Technology, Ms. Jackson held various positions with PPG Industries, Inc., a global supplier of paints, chemicals, optical and specialty products and glass, from 1999-2011. Ms. Jackson currently serves as a member of the board of directors and a member of the Audit, Nominating and Corporate Governance, and Scientific Advisory Committees of Sensient Technologies Corporation, a leading global developer, manufacturer, and marketer of colors, flavors, and fragrances. She also serves as Chairman and President of the World Refractories Association and is a director of Junior Achievement of Western Pennsylvania.
We believe Ms. Jackson’s qualifications to serve on the Company’s board of directors include the depth and breadth of her experience in global business operations and industrial manufacturing, executive level leadership experience, mergers and acquisitions, legal experience and public board experience in the steel and coatings industries.
|
|
|
| |
VENITA MCCELLON - ALLEN
Age: 61
Director Since: 2016
Board Committees:
• Audit Committee
• Compensation Committee
|
| |
Venita McCellon – Allen formerly served as the President and Chief Operating Officer of Southwestern Electric Power Company (“SWEPCO”), a subsidiary of American Electric Power Company, Inc. (“AEP”), a public utility holding company which engages in the generation, transmission, and distribution of electricity for sale to retail and wholesale customers, and held such office from 2010 to 2018. Previously, she served as Executive Vice President – AEP Utilities East from 2009 to 2010 and Executive Vice President – AEP Utilities West from 2006 to 2009. From 2004 to 2006, Ms. McCellon-Allen served as Senior Vice President Shared Services of AEP responsible for information technology, supply chain management and human resources. From 2000 to 2004, she served as Senior Vice President - Human Resources for Baylor Health Care System, a diversified health care holding company. From 1995 to 2000, Ms. McCellon-Allen held various leadership roles at Central and South West Corp. (“CSW”), in operations, customer service, strategic planning and human resources. During 1997 to 2000, Ms. McCellon-Allen led CSW’s merger integration with AEP. In her last position at CSW, she served as Senior Vice President for Corporate Development and Customer Service.
We believe Ms. McCellon-Allen’s qualifications to serve on the board of directors include her considerable business and executive level leadership experience in operations, corporate governance, external affairs, regulatory matters, merger integration, talent development and executive compensation all within and outside of the energy industry.
|
|
|
15
|
Proxy Statement
|
|
| |
ED MCGOUGH
Age: 60 Director Since: 2017 Board Committees:
• Compensation Committee
(Chairman)
• Nominating and Corporate
Governance Committee
|
| |
Ed McGough has served as the Senior Vice President of Manufacturing and Technical Operations at Alcon, Inc. (“Alcon”), since 2008. Alcon is the global leader in eye care developing, manufacturing and distributing innovative medical devices for eye care needs. Mr. McGough joined Alcon in 1991 as a Manager of Quality Assurance and Regulatory Affairs in Alcon’s Pennsylvania facility. He has held various other leadership positions at Alcon in both Fort Worth, Texas and Puerto Rico, including: Director of Quality Assurance from 1992 to 1994; Director of Operations from 1994 to 1996; Director of Manufacturing from 1996 to 2000; and Vice President and General Manager of Manufacturing in Fort Worth, Texas and Houston, Texas from 2000 to 2006. Following these roles, he served as Vice President, Manufacturing, Pharmaceutical Operations, responsible for Alcon’s pharmaceutical plants in the United States, Brazil, Mexico, Spain, Belgium and France. Prior to joining Alcon, Mr. McGough served in various quality engineering and management roles with Baxter Healthcare Corporation from 1983 to 1991.
We believe Mr. McGough’s qualifications to serve on the board of directors include (i) his executive level leadership and international experience in global manufacturing, distribution and global supply chain; and (ii) his experience integrating acquired medical device companies into Alcon which aligns well with our Company’s long term acquisition strategy.
|
|
|
| |
STEVEN R. PURVIS
Age: 56 Director Since: 2015 Board Committees: • Audit Committee
• Nominating and Corporate
Governance Committee
|
| |
Steven R. Purvis is a Principal of Luther King Capital Management (“LKCM”). He joined the firm in 1996 as Director of Research, became Co-Manager on the Small Cap Strategy in 1998 and Lead Manager in 2000. Mr. Purvis currently serves as a Portfolio Manager responsible for small cap and small mid-cap public equity focused investment portfolios. In addition to his public markets experience, he has also led and participated in many venture capital, private equity and real estate investments. He has been a Principal of LKCM since 2004 and a Trustee to the LKCM Funds since 2013. Prior to joining LKCM, Mr. Purvis served as a Senior Analyst to Roulston Research from 1993 to 1996 and also served as a Research Analyst at Waddell & Reed, Inc. from 1990 to 1993.
We believe Mr. Purvis’s qualifications for serving on the board of directors includes his distinguished career as a portfolio manager in the public equity markets with a focus on small to mid-cap companies, experience in analyzing corporate strategy and investment decisions across multiple industries and his ability to add an additional layer of financial analytics to the board’s deliberations.
|
|
|
16
|
Proxy Statement
|
|
Summary of Director Experience,
Qualifications, Attributes and Skills
|
| |
Berce
|
| |
Eisman
|
| |
Feehan
|
| |
Ferguson
|
| |
Grannum
|
| |
Jackson
|
| |
McCellon-
Allen
|
| |
McGough
|
| |
Purvis
|
|
|
CEO/Senior Executive Leadership Experience
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
|
|
Financial Expertise
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
|
| |
⬤
|
| |
⬤
|
| |
|
| |
|
| |
⬤
|
|
|
Manufacturing and Distribution Expertise
|
| |
|
| |
⬤
|
| |
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
|
| |
⬤
|
| |
⬤
|
|
|
Technological Expertise
|
| |
|
| |
|
| |
|
| |
⬤
|
| |
⬤
|
| |
|
| |
|
| |
|
| |
|
|
|
Energy Industry Expertise
|
| |
|
| |
⬤
|
| |
|
| |
⬤
|
| |
|
| |
|
| |
⬤
|
| |
|
| |
|
|
|
International Experience
|
| |
⬤
|
| |
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
|
| |
⬤
|
| |
|
|
|
Strategic Planning and Oversight
|
| |
⬤
|
| |
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
|
|
Corporate Governance
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
|
|
Mergers and Acquisitions
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
|
|
Digital Technology
|
| |
⬤
|
| |
|
| |
|
| |
⬤
|
| |
|
| |
|
| |
|
| |
⬤
|
| |
|
|
|
Race/Ethnicity
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
African American
|
| |
|
| |
|
| |
|
| |
|
| |
⬤
|
| |
|
| |
|
| |
|
| |
|
|
|
Asian/Pacific Islander
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
White/Caucasian
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
|
|
Hispanic/Latino
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
Native American
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
Gender
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
Male
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
⬤
|
| |
|
| |
|
| |
⬤
|
| |
⬤
|
|
|
Female
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
⬤
|
| |
⬤
|
| |
|
| |
|
|
|
17
|
Proxy Statement
|
|
AZZ Inc.
Investor Relations
One Museum Place, Suite 500
3100 West 7th Street
Fort Worth, TX 76107
Telephone: 817-810-0095
Fax: 817-336-5354
Email: info@azz.com
|
|
|
18
|
Proxy Statement
|
|
White
|
| |
54.00%
|
|
|
Hispanic
|
| |
33.00%
|
|
|
African American
|
| |
8.40%
|
|
|
Asian
|
| |
1.40%
|
|
|
Multi-Racial
|
| |
1.60%
|
|
|
American Indian or Alaska Native
|
| |
0.67%
|
|
|
Native Hawaiian or Other Pacific Islander
|
| |
0.93%
|
|
|
|
| |
Women
|
| |
Men
|
|
|
U.S. Employees
|
| |
13.3%
|
| |
86.7%
|
|
|
Global Employees
|
| |
12.4%
|
| |
87.6%
|
|
|
Age
|
| |
% of
Total
Employees
|
|
|
Under 20
|
| |
1.4%
|
|
|
20 - 30
|
| |
18.3%
|
|
|
31 - 40
|
| |
25.1%
|
|
|
41 - 50
|
| |
24.9%
|
|
|
51 - 60
|
| |
21.0%
|
|
|
>61
|
| |
9.3%
|
|
|
19
|
Proxy Statement
|
|
Health
|
| |
Financial
|
| |
Work/Life
|
|
|
Medical, Dental and Vision
|
| |
Competitive Base Salaries
|
| |
Company/Voluntary Life Insurance
|
|
|
Medical Insurance Premium Reduction
|
| |
Hourly Overtime and Shift Differential Pay
|
| |
Paid Time off and Holiday Pay and
Flexible Work Arrangements
|
|
|
Health Screenings
|
| |
Cash Incentive Program (annual)
|
| |
Accidental Death & Dismemberment
|
|
|
Prescription Drug Coverage
|
| |
Employee Stock Purchase Plan
|
| |
Paid Short-Term and Long-Term Disability
|
|
|
24/7/365 Virtual and Telehealth Services
|
| |
100% 401(k) match for the first 1% and 50% match between 2% and 6%
|
| |
Paid Sick and Safe Leave
|
|
|
Annual Flu Immunizations
|
| |
Pre-tax Contributions to Eligible Savings Accounts
|
| |
Family Emergency Leave
|
|
|
Employee Assistance Program
|
| |
Tuition reimbursement
|
| |
Military Leave
|
|
|
20
|
Proxy Statement
|
|
Segment
|
| |
TRIR
|
| |
LTIR
|
| |
DART
|
|
|
Metal Coatings Segment
|
| |
4.40
|
| |
1.30
|
| |
3.10
|
|
|
Infrastructure Solutions Segment
|
| |
|
| |
|
| |
|
|
|
• Electrical Platform
|
| |
0.95
|
| |
0.34
|
| |
0.84
|
|
|
• Industrial Platform
|
| |
0.00
|
| |
0.00
|
| |
0.00
|
|
|
21
|
Proxy Statement
|
|
•
|
| |
Board composition, refreshment and diversity
|
| |
•
|
| |
Board oversight of corporate strategy and risk management
|
|
|
•
|
| |
Environmental and social issues
|
| |
•
|
| |
Human capital management
|
|
|
•
|
| |
ESG disclosure and reporting
|
| |
•
|
| |
Shareholder engagement and activism
|
|
|
Each director attended 100% of the meetings of the board and the board committees on which he or she served that were held during fiscal year 2021.
|
|
|
22
|
Proxy Statement
|
|
AUDIT COMMITTEE(1)
|
|
|
Committee Members: Daniel E. Berce* (Chairman), Paul Eisman, Venita McCellon-Allen, and Steven R. Purvis*
|
|
|
Committee Functions
|
|
•
|
Oversees the Company’s accounting, auditing, financial reporting, systems of internal controls regarding finance and accounting and corporate finance strategy;
|
•
|
Directly responsible for the appointment, compensation, retention and oversight of the independent registered public accounting firm;
|
•
|
Pre-approves all auditing services and permitted non-audit services to be performed for the Company by its independent auditor;
|
•
|
Reviews and discusses with management (i) the guidelines and policies that govern the processes by which the Company assesses and manages its exposure to risk; and (ii) the Company’s major financial and other risk exposures and the steps management has taken to monitor and control such exposures;
|
•
|
Meets regularly in executive session with the Company’s management, internal and independent auditors; and
|
•
|
Reviews and approves any proposed related-party transactions consistent with the Company’s policy regarding such transactions and reports any findings to the full board.
|
(1)
|
Mr. Grannum was appointed to serve on the audit committee on April 2, 2021.
|
|
COMPENSATION COMMITTEE(1)
|
|
|
Committee Members: Ed McGough (Chairman), Daniel E. Berce, Paul Eisman, Daniel R. Feehan and Venita McCellon-Allen
|
|
|
Committee Functions
|
|
•
|
Establishes, oversees and adjusts the Company’s incentive-based compensation plans, sets compensation for our CEO and approves compensation for the other executive officers;
|
•
|
Reviews and discusses with management the Compensation Discussion & Analysis to be included in the Company’s annual report and proxy statement;
|
•
|
Reviews and approves employment agreements, severance agreements or other significant matters relating to the Company’s CEO and other executive officers, including the annual performance review of the CEO;
|
•
|
Assists the board in its oversight of the development, implementation and effectiveness of our policies and strategies relating to our human capital management function, (including: recruiting; retention; career development; management succession; and diversity and employment practices);
|
•
|
Reviews with management and recommends to the board changes in the Company’s compensation structure and programs and its competitiveness as an employer; and
|
•
|
Administers the Company’s Compensation Recovery Policy allowing AZZ to recoup incentive-based compensation paid to applicable officers and employees in the event of a financial restatement or misconduct.
|
(1)
|
Mr. Grannum and Ms. Jackson were appointed to the compensation committee and Mr. Eisman rotated from the compensation committee to the nominating and corporate governance committee, all on April 2, 2021.
|
|
23
|
Proxy Statement
|
|
NOMINATING AND CORPORATE GOVERNANCE COMMITTEE(1)
|
|
|
Committee Members: Daniel R. Feehan (Chairman), Kevern R. Joyce(2), Ed McGough, and Steven R. Purvis
|
|
|
Committee Functions
|
|
•
|
Identifies potential individuals qualified to become members of the board consistent with criteria approved by the board;
|
•
|
Recommends director candidates to the board for election at the annual meetings of shareholders or to fill vacancies pursuant to the Company’s Bylaws;
|
•
|
Recommends director nominees to the board for each board committee and the chairman of the board;
|
•
|
Responsible for establishing and overseeing AZZ’s Corporate Governance Guidelines, Code of Conduct and the director nomination process;
|
•
|
Provide oversight of AZZ’s environmental, social and governance (“ESG”) policies and sustainability practices that are of significance to AZZ and its shareholders;
|
•
|
Regularly reviews and makes recommendations to the board regarding director compensation; and
|
•
|
Leads an annual process for evaluating the performance of the board as a whole and each of the board committees and report its findings and recommendations to the board.
|
(1)
|
On April 2, 2021, Mr. Eisman was appointed to serve on the nominating and corporate governance committee.
|
(2)
|
Mr. Joyce retired from the Board of Directors on February 1, 2021.
|
|
Director
|
| |
Audit
Committee
|
| |
Compensation
Committee
|
| |
Nominating and
Corporate Governance
Committee
|
|
|
Daniel E. Berce
|
| |
|
| |
|
| |
|
|
|
Paul Eisman
|
| |
|
| |
|
| |
|
|
|
Daniel R. Feehan*
|
| |
|
| |
|
| |
|
|
|
Clive A. Grannum
|
| |
|
| |
|
| |
|
|
|
Carol R. Jackson
|
| |
|
| |
|
| |
|
|
|
Venita McCellon-Allen
|
| |
|
| |
|
| |
|
|
|
Ed McGough
|
| |
|
| |
|
| |
|
|
|
Steven R. Purvis
|
| |
|
| |
|
| |
|
|
|
Member
|
|
Chair
|
*
|
Chairman of AZZ’s Board of Directors
|
|
24
|
Proxy Statement
|
•
|
Preside at board meetings;
|
•
|
Preside at executive sessions or other meetings of the non-employee directors;
|
•
|
Recommend the retention of any consultants, legal, financial or other professional advisors who are to report directly to the board of directors;
|
•
|
Consult with management as to the agenda items for board and committee meetings; and
|
•
|
Coordinate with committee chairs in the development and recommendations regarding board and committee meeting schedules.
|
|
25
|
Proxy Statement
|
|
DIRECTORS STAND FOR ELECTION ANNUALLY BY MAJORITY VOTE
|
| |
Pursuant to AZZ’s Bylaws, all members of its board of directors are elected annually. Our Bylaws require that we use a majority voting standard in which a director nominee must receive more votes cast “For” than “Against” in order to be elected.
|
|
|
OUR NON-EMPLOYEE DIRECTORS HOLD REGULAR EXECUTIVE SESSIONS
|
| |
AZZ’s non-employee directors meet in executive session at each regularly scheduled in person board meeting without management present.
|
|
|
BOARD MEMBERS MAY SUBMIT AGENDA ITEMS AND INFORMATION REQUESTS
|
| |
Each board member may request items to be placed on the agenda for board meetings, raise subjects that are not on the agenda for that meeting or request information that has not otherwise been provided during the meeting. Additionally, the chairman of the board reviews and approves all board meeting schedules and agendas and consults with the CEO regarding other information sent to the board in connection with board meetings or other board action items.
|
|
|
BOARD MEMBERS HAVE COMPLETE ACCESS WITH MANAGEMENT
|
| |
Each board member has complete and open access to any member of the Company’s management team and to the chairman of each board committee for the purpose of discussing any matter related to the work of such committee.
|
|
|
BOARD MEMBERS MAY REQUEST SPECIAL BOARD MEETINGS
|
| |
Special meetings of the board may be called by the chairman of the board or the Company’s CEO or Secretary at the request of any board member.
|
|
|
THE BOARD OR ANY BOARD COMMITTEE MAY RETAIN INDEPENDENT ADVISORS
|
| |
The board and each board committee has the authority at any time to retain independent auditors, legal, financial and other advisors as they deem appropriate.
|
|
|
Initiation of Process
|
| |
>
|
| |
The annual board and board committee evaluation process is reviewed with the board members by the chairman of the board in advance of taking the surveys.
|
|
|
Discussion
|
| |
>
|
| |
The evaluation responses are confidentially compiled by a third party and a summary report is provided to the chairman of the board and each committee chairman prior to the discussion of the results with the board members. Committee chairs lead their respective committee evaluation discussions during executive session.
|
|
|
Follow-Up
|
| |
>
|
| |
The chairman of the board shares a summary of the board evaluation results which addresses any requests or enhancements in practices that may be applicable to the functionality of the board or management’s quarterly reporting process. Committee chairmen report on their respective committee evaluations to the full board.
|
|
|
26
|
Proxy Statement
|
•
|
The audit committee oversees the integrity of the financial statements of the Company, the independent auditor's qualifications and independence, the performance of the Company's internal audit function and independent auditors and the Company’s compliance with legal and regulatory requirements. Complaints and concerns relating to AZZ’s accounting matters should be communicated to the audit committee. Any such communications may be made on an anonymous basis. Any concerns or complaints may be reported to the audit committee through a third-party vendor, NAVEX Global Inc., which has been retained by the audit committee for this purpose. The AZZ Alertline may be accessed toll-free at 1 (855) 268-6428 or via the website at www.azz.alertline.com. Outside parties, including customers, vendors, suppliers or shareholders may bring issues regarding accounting matters to the attention of the audit committee by writing to the Chairman of the Audit Committee, AZZ Inc., 3100 West 7th St., Suite 500, Fort Worth, TX 76107. All complaints and concerns will be reviewed under the direction of the audit committee and oversight provided by the board of directors and other appropriate persons as determined by the audit committee.
|
•
|
The compensation committee oversees the risks relating to the Company’s compensation philosophy and programs and generally evaluates any potential effect the Company’s compensation structure may have on management risk taking. The compensation committee reviews the recommendations of the Company’s management regarding adjustments to the Company’s executive compensation programs. The compensation committee has retained and regularly meets with Meridian Compensation Partners, LLC (“Meridian”), its independent executive compensation consultant, which assists the compensation committee in evaluating
|
|
27
|
Proxy Statement
|
•
|
The nominating and corporate governance committee provides oversight on the composition of the board of directors and it’s committees and provides leadership to the board in maintaining best corporate practices in the Company’s corporate governance principles and practices. Many of our corporate policies are summarized in the Company’s Code of Conduct, including our policies regarding conflict of interest, insider trading, related-party transactions, environmental health and safety, human rights, sustainability, confidentiality and compliance with laws and regulations applicable to the way the Company conducts its business.
|
•
|
All officers, directors, employees and representatives are required to acknowledge and agree to be bound by the Code of Conduct and are subject to disciplinary action, including termination, for violations. The Code of Conduct and the Vendor Code of Business Conduct are published on our website at www.azz.com under the heading “Investor Relations.” Any amendments to the Code of Conduct or the grant of a waiver from a provision of the Code of Conduct requiring disclosure under applicable SEC rules will be disclosed on our website. Under our Code of Conduct, directors, officers and employees are expected to report any violation or waiver of any provision of the Code of Conduct to the Company’s chief legal officer. Anyone may report matters of concern to the AZZ legal department through our anonymous, confidential toll-free AZZ Alertline at 1 (855) 268-6428, online at www.azz.alertline.com, or by writing to the Chief Legal Officer, AZZ Inc., 3100 West 7th St., Suite 500, Fort Worth, TX 76107.
|
|
28
|
Proxy Statement
|
|
Highlights of our Non-Employee Director Compensation Program
|
| |||
|
✔
|
| |
No Fees for Board or Committee Meeting Attendance: Meeting attendance is an expected part of board service.
|
|
|
✔
|
| |
Emphasis on Equity: There is an emphasis on equity in the overall compensation mix to further align interests with shareholders.
|
|
|
✔
|
| |
Recognition of Special Roles: Special roles, such as Chairman of the Board and Committee Chairs are fairly recognized for their additional time commitments.
|
|
|
✔
|
| |
Robust Stock Ownership Guidelines: A guideline of five times the annual board membership cash retainer supports alignment with shareholders’ interests.
|
|
|
✔
|
| |
Formulaic Annual Equity Grants with Immediate Vesting: Equity awards are granted annually under a fixed-value formula with immediate vesting to support independence.
|
|
|
Service
|
| |
Fee Amount
|
|
|
Annual Retainer for Board Service
|
| |
$70,000
|
|
|
Annual Retainer for Board Chairman Service
|
| |
$60,000
|
|
|
Annual Audit Committee Chairman Retainer
|
| |
$10,000
|
|
|
Annual Audit Committee Member Retainer
|
| |
$5,000
|
|
|
Annual Compensation Committee Chairman Retainer
|
| |
$5,000
|
|
|
Annual Nominating and Corporate Governance Committee Chairman Retainer
|
| |
$1,500
|
|
|
29
|
Proxy Statement
|
|
Name
|
| |
Fees
Earned or
Paid in Cash
|
| |
Stock
Awards
(1)
|
| |
Total
Compensation
|
|
|
Daniel E. Berce
|
| |
$85,000
|
| |
$104,996
|
| |
$189,996
|
|
|
Paul Eisman
|
| |
$75,000
|
| |
$104,996
|
| |
$179,996
|
|
|
Daniel R. Feehan
|
| |
$131,500
|
| |
$104,996
|
| |
$236,496
|
|
|
Clive A. Grannum(2)
|
| |
$5,833
|
| |
$—
|
| |
$5,833
|
|
|
Carol R. Jackson(2)
|
| |
$5,833
|
| |
$—
|
| |
$5,833
|
|
|
Kevern R. Joyce(3)
|
| |
$64,167
|
| |
$104,996
|
| |
$169,163
|
|
|
Venita McCellon-Allen
|
| |
$75,000
|
| |
$104,996
|
| |
$179,996
|
|
|
Ed McGough
|
| |
$75,000
|
| |
$104,996
|
| |
$179,996
|
|
|
Steven R. Purvis
|
| |
$75,000
|
| |
$104,996
|
| |
$179,996
|
|
(1)
|
Eligible directors received an annual equity grant of common stock of the Company having a $105,000 fair market value at the time of grant, on the date of the annual meeting of shareholders, which was July 8, 2020. The equity values in this column for the fiscal year ended February 28, 2021 reflect the aggregate grant date fair market value calculated in accordance with FASB ASC Topic 718 for stock granted to each of the non-employee directors under the 2014 Plan. Assumptions used in the calculation of this amount are included in Note 11 to the Company’s audited financial statements for the fiscal year ended February 28, 2021, included in the Company’s Annual Report on Form 10-K.
|
(2)
|
The amounts reported have been pro-rated based upon Ms. Jackson’s and Mr. Grannum’s appointment to the board of directors on February 1, 2021. They did not receive annual equity grants as they were not members of the board on July 8, 2020.
|
(3)
|
The amount reported was pro-rated based upon Mr. Joyce’s retirement on February 1, 2021.
|
|
30
|
Proxy Statement
|
|
Mr. Daniel R. Feehan
Chairman of the Board
c/o AZZ Inc.
One Museum Place, Suite 500
3100 West 7th Street
Fort Worth, Texas 76107
|
|
•
|
spam;
|
•
|
junk mail and mass mailings;
|
•
|
product or service inquiries or complaints;
|
•
|
new product or service suggestions;
|
•
|
resumes and other forms of job inquiries;
|
•
|
surveys; and
|
•
|
business solicitations or advertisements.
|
|
31
|
Proxy Statement
|
•
|
relevant industry knowledge and diversity of background and experience;
|
•
|
practical wisdom and mature judgment;
|
•
|
personal and professional demonstration of ethics, integrity and professionalism; and
|
•
|
willingness to represent the best interests of shareholders and objectively appraise management’s performance.
|
•
|
chief executive officer, chief financial officer or other executive level experience;
|
•
|
financial and accounting expertise;
|
•
|
corporate governance experience;
|
•
|
mergers and acquisitions experience;
|
•
|
general domestic and global knowledge of the electrical and industrial products industry, metal coatings services or the highly engineered welding services industry;
|
•
|
international experience; and
|
•
|
strategic planning and oversight expertise.
|
|
32
|
Proxy Statement
|
•
|
To add members with significant international experience;
|
•
|
To add members with engineering and industrial manufacturing expertise;
|
•
|
To provide for a smooth transition over time while reducing the average age and tenure of the board;
|
•
|
To expand the board size so that no member serves on more than two committees;
|
•
|
To add diversity and strength to the board through race, gender, national origin, education, differences in education, and professional experience; and
|
•
|
To gradually add members to the board over the next several years and maintain board stability and culture during the refreshing process.
|
|
33
|
Proxy Statement
|
|
34
|
Proxy Statement
|
|
Name of Beneficial Owner
|
| |
Amount and Nature of
Beneficial
Ownership(1)
|
| |
Percent of
Common Stock
Outstanding
|
| |
Shares of Unvested
RSUs and PSUs
that Vest Within
60 Days of
4/30/2021
|
|
|
Daniel E. Berce
|
| |
68,045
|
| |
*
|
| |
|
|
|
Paul Eisman
|
| |
13,802
|
| |
*
|
| |
|
|
|
Daniel R. Feehan
|
| |
69,795
|
| |
*
|
| |
|
|
|
Thomas E. Ferguson
|
| |
109,794
|
| |
*
|
| |
39,778
|
|
|
Clive A. Grannum(2)
|
| |
—
|
| |
*
|
| |
|
|
|
Gary Hill
|
| |
14,058
|
| |
*
|
| |
7,632
|
|
|
Carol R. Jackson(2)
|
| |
—
|
| |
*
|
| |
|
|
|
Kevern R. Joyce(3)
|
| |
63,420
|
| |
*
|
| |
|
|
|
Tara D. Mackey(4)
|
| |
8,077
|
| |
*
|
| |
9,159
|
|
|
Venita McCellon-Allen
|
| |
15,802
|
| |
*
|
| |
|
|
|
Ed McGough
|
| |
9,161
|
| |
*
|
| |
|
|
|
Steven R. Purvis
|
| |
12,717
|
| |
*
|
| |
|
|
|
Philip A. Schlom
|
| |
1,451
|
| |
*
|
| |
1,437
|
|
|
Bryan Stovall
|
| |
14,141
|
| |
*
|
| |
3,063
|
|
|
All Current Directors and Executive Officers as a Group (17 persons)
|
| |
431,417(5)
|
| |
2.05%
|
| |
82,595(6)
|
|
*
|
Indicates beneficial ownership of less than 1% of the outstanding shares of AZZ’s common stock.
|
(1)
|
Each person named in the table above has sole investment and voting power with respect to all shares of common stock shown to be beneficially owned by such person. Beneficial ownership has been determined in accordance with Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The percentage of voting stock held is based upon 25,032,833 shares outstanding as of April 30, 2021.
|
(2)
|
Ms. Jackson and Mr. Grannum were appointed to the board of directors on February 1, 2021 and did not receive equity grants during the Company’s fiscal year, which ended on February 28, 2021.
|
(3)
|
This number represents the total shares of AZZ common stock held by Mr. Joyce as of the date of his retirement on February 1, 2021.
|
(4)
|
This number does not include 2,711 stock appreciation rights (“SARs”) that Ms. Mackey has the right to exercise within 60 days of April 30, 2021. These SARs do not convert into common stock on a one-for-one basis when exercised. The SARs are settled in shares of AZZ common stock for an amount equal to the excess value of the exercise price over the grant date price.
|
(5)
|
The number of shares of our common stock that all of our directors and executive officers own as a group (including any non-NEO executive officers). This number also includes 43,573 RSUs and 39,022 PSUs (including accrued dividends) that will vest within 60 days of April 30, 2021 for our executive officers (including any non-NEO executive officers).
|
(6)
|
This number also includes 10,380 RSUs and 11,146 PSUs (including accrued dividends) of all non-NEO executive officers that will vest within 60 days of April 30, 2021.
|
|
35
|
Proxy Statement
|
|
Name and Address of Beneficial Owner
|
| |
Date of Schedule 13G/A
Filing
|
| |
Amount and Nature
of Beneficial
Ownership(1)
|
| |
Percent of Class
|
|
|
BlackRock, Inc.
55 East 52nd Street
New York, NY 10055
|
| |
January 26, 2021
|
| |
3,955,221
|
| |
15.2%
|
|
|
The Vanguard Group, Inc.
100 Vanguard Blvd.
Malvern, PA 19355
|
| |
February 10, 2021
|
| |
2,626,575
|
| |
10.1%
|
|
|
T. Rowe Price Associates, Inc.
100 East Pratt Street
Baltimore, MD 21202
|
| |
February 10, 2021
|
| |
2,599,570
|
| |
10.2%
|
|
(1)
|
The table below relates to the column above titled “Amount and Nature of Beneficial Ownership”.
|
|
Beneficial Owner
|
| |
Sole Power
to Vote
|
| |
Shared
Power to
Vote
|
| |
Sole Power to
Dispose
|
| |
Shared
Power to
Dispose
|
|
|
Blackrock, Inc.
|
| |
3,909,041
|
| |
0
|
| |
3,955,221
|
| |
0
|
|
|
The Vanguard Group, Inc.
|
| |
0
|
| |
26,533
|
| |
2,578,117
|
| |
48,458
|
|
|
T. Rowe Price Associates, Inc.
|
| |
604,465
|
| |
0
|
| |
2,599,570
|
| |
0
|
|
|
36
|
Proxy Statement
|
|
|
| |
|
|
|
|
| |
PROPOSAL 2
APPROVAL OF THE COMPANY’S EXECUTIVE COMPENSATION PROGRAM
|
|
|
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE APPROVAL, ON A NON-BINDING ADVISORY BASIS, OF AZZ’S EXECUTIVE COMPENSATION PROGRAM.
|
|
|
37
|
Proxy Statement
|
|
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE FOR “ONE YEAR” ON THE PROPOSAL TO DETERMINE THE FREQUENCY OF SAY-ON-PAY VOTES.
|
|
|
38
|
Proxy Statement
|
•
|
Thomas E. Ferguson – President and Chief Executive Officer
|
•
|
Philip Schlom – Senior Vice President and Chief Financial Officer
|
•
|
Tara D. Mackey – Chief Legal Officer and Secretary
|
•
|
Gary Hill – Chief Operating Officer – Infrastructure Solutions
|
•
|
Bryan Stovall – Chief Operating Officer – Metal Coatings
|
•
|
Paul W. Fehlman – Former Senior Vice President and Chief Financial Officer
|
|
39
|
Proxy Statement
|
•
|
the completion of an acquisition in our Metal Coatings segment to expand our market coverage;
|
•
|
a divestiture of non-core businesses in each of our Metal Coatings and Infrastructure Solutions segments;
|
•
|
successful refinancing of our $125 million notes, saving the Company $2.5M in annual interest;
|
•
|
an increase of our shareholder communications by engaging in over 170 investor relations conference calls and virtual investor road shows;
|
•
|
conducting a competitive selection process with insurance brokers, which resulted in the negotiation of flat broker fees and insurance premiums from the prior year, in a market that was experiencing 15 – 20% rate increases as the norm;
|
•
|
successful navigation of the market disruptions caused by the ongoing COVID-19 pandemic; and
|
•
|
completion of several operational improvement initiatives, including continuing to invest in digital galvanizing systems.
|
|
40
|
Proxy Statement
|
•
|
Our NEOs’ total compensation is comprised of a mix of base salary, annual short-term cash incentive compensation, long-term incentive equity awards and other benefits. The table below illustrates the chief executive officer’s total compensation for fiscal years 2017 through 2021 in comparison with the Company’s stock performance. Actual total compensation paid to Mr. Ferguson during fiscal year 2021 was lower than fiscal year 2020 as a result of a reduced payout under the Company’s annual short-term cash incentive plan. For additional detail see also the section below titled “Performance-Based Incentive Compensation”.
|
•
|
The compensation committee determined that there would be no annual merit increases for any of the NEOs for fiscal year 2021. However, three of our NEOs received salary increases during the year due to promotions. For more information regarding their promotions, see the discussion below under the heading “Base Salary” on page 48.
|
|
41
|
Proxy Statement
|
•
|
For fiscal year 2021, our NEOs continued to receive a substantial portion of their compensation in the form of equity compensation, a portion of which is at risk because the awards are tied to increasing shareholder value through return on net assets and stock appreciation performance metrics in the form of performance share units (“PSUs”) and the other portion of equity compensation being tied to time vested RSUs. The grant value of equity awards made to our NEOs in fiscal year 2021 was allocated 50% to RSUs and 50% to PSUs, except for Mr. Stovall, who’s equity awards were allocated 60% to RSUs and 40% to PSUs. The graphs below show the elements of compensation that comprised the mix of total direct compensation for Mr. Ferguson and the average mix of total direct compensation for the other NEOs. The charts illustrate that approximately 77% of Mr. Ferguson’s total direct compensation and 58% of the average total direct compensation for the other NEOs was tied to the Company’s financial performance, which aligns their interests with those of the Company’s shareholders. The total direct compensation illustrated in the charts below does not include perquisites, retirement and other benefits.
|
|
Named Executive Officer
|
| |
Percent of Fiscal Year 2021
Pay At Risk
|
|
|
Thomas E. Ferguson
|
| |
77%
|
|
|
Philip Schlom
|
| |
62%
|
|
|
Tara D. Mackey
|
| |
60%
|
|
|
Gary Hill
|
| |
52%
|
|
|
Bryan Stovall
|
| |
59%
|
|
•
|
Messrs. Ferguson, Schlom and Hill each have an employment agreement with the Company. All of our NEOs are employed at will and are expected to demonstrate exceptional personal performance and leadership in order to continue serving as a member of the executive management team.
|
•
|
For fiscal year 2021, payments made under the Company’s Senior Management Bonus Plan (“STI Plan”) were above target for the NEOs, aligning compensation with the Company’s performance in a COVID disrupted year. The above target payout was achieved, even with the compensation committee increasing the payment threshold.
|
•
|
On the last day of fiscal year 2021, the three-year performance cycle for the PSUs granted to our NEOs on May 18, 2018 (the “FY2019 PSUs”), concluded. The payout on the FY2019 PSUs was determined based on two performance metrics. The first performance metric was based upon the Company’s achievement of adjusted return on assets (“Adjusted ROA”), as compared to a specified group of peer companies, over the three-year performance cycle. Adjusted ROA is defined below:
|
|
Adjusted ROA is
|
| |
Adjusted Net Income
|
|
|
Total Assets – (Current Liabilities – Current Debt)
|
|
|
42
|
Proxy Statement
|
|
Adjusted ROA
% Ranking Achieved(1)
|
| |
% of Target Award
Payout
|
|
|
<25%
|
| |
0%
|
|
|
25%
|
| |
50%
|
|
|
50%
|
| |
100%
|
|
|
100%
|
| |
200%
|
|
(1)
|
The percentage of target PSUs will be interpolated for performance percentiles that fall between the Adjusted ROA percentages shown above.
|
|
•
|
| |
Chart Industries Inc.
|
| |
•
|
| |
Littelfuse, Inc.
|
|
|
•
|
| |
Dynamic Materials Corp.
|
| |
•
|
| |
MasTec, Inc.
|
|
|
•
|
| |
Enersys, Inc.
|
| |
•
|
| |
Powell Industries Inc.
|
|
|
•
|
| |
ESCO Technologies Inc.
|
| |
•
|
| |
Preformed Line Products Company
|
|
|
•
|
| |
Franklin Electric Co., Inc.
|
| |
•
|
| |
Regal Beloit Corporation
|
|
|
•
|
| |
Haynes International Inc.
|
| |
•
|
| |
Team, Inc.
|
|
|
•
|
| |
L.B. Foster Company
|
| |
•
|
| |
Valmont Industries Inc.
|
|
|
Name
|
| |
Grant Date
Target Value
|
| |
Target # of PSUs
Granted at
Target
|
| |
Payout Total # of
Shares Earned(1)
|
| |
Market
Value(2)
|
|
|
Thomas W. Ferguson
|
| |
$600,000
|
| |
14,285
|
| |
19,116
|
| |
$976,636
|
|
|
Philip Schlom(3)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
Paul Fehlman(4)
|
| |
$225,000
|
| |
5,357
|
| |
—
|
| |
—
|
|
|
Tara D. Mackey
|
| |
$150,000
|
| |
3,571
|
| |
4,778
|
| |
$244,108
|
|
|
Gary Hill
|
| |
$125,000
|
| |
2,976
|
| |
4,013
|
| |
$203,440
|
|
|
Bryan Stovall(3)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
(1)
|
The total number of shares earned include dividend equivalents accrued during the FY2019 PSU performance cycle (March 1, 2019 – February 28, 2021), which consisted of 650 for Mr. Ferguson; 162 for Ms. Mackey; and 135 for Mr. Hill.
|
(2)
|
This amount represents the market value of the FY2019 PSUs at the conclusion of their performance cycle, which was February 28, 2021, and is based upon the closing market price of AZZ common stock as of February 26, 2021 (the last trading day of the Company’s fiscal year 2021), which was $51.09.
|
(3)
|
Messrs. Schlom and Stovall did not receive PSU awards during fiscal year 2019.
|
(4)
|
As a result of Mr. Fehlman’s separation from the Company on May 31, 2020, the PSUs granted to him during fiscal year 2019 were forfeited.
|
|
43
|
Proxy Statement
|
|
|
| |
What We Do
|
|
|
✔
|
| |
A significant portion of our executive officers’ total compensation is based upon the Company’s performance, and the payouts are contingent upon the attainment of certain pre-established performance metrics and capped to minimize risk.
|
| |
✔
|
| |
The compensation committee engages an independent executive compensation consultant.
|
|
|
✔
|
| |
Performance measures are highly correlated to the creation of shareholder value.
|
| |
✔
|
| |
Our compensation committee conducts an annual review of all executive compensation program components to ensure alignment with our compensation objectives.
|
|
|
✔
|
| |
We review and benchmark pay relative to the market median of our industry peer group on an annual basis.
|
| |
✔
|
| |
We implemented a Compensation Recovery Policy to protect the Company in the event of a financial restatement or an executive officer engages in serious misconduct.
|
|
|
✔
|
| |
Our executive compensation program is designed to encourage building long-term shareholder value and attract and retain high performance executive talent.
|
| |
✔
|
| |
We provide a limited number of employment agreements and executive perquisites.
|
|
|
✔
|
| |
We use annual cash incentive opportunities and equity-based awards to balance the Company’s short- and long-term performance objectives.
|
| |
✔
|
| |
We have stock ownership guidelines for directors and executive officers.
|
|
|
✔
|
| |
Our equity awards are equally weighted between time-vested RSUs, which vest ratably over a three-year period, and PSUs, which emphasize achievement of financial performance metrics over a three-year performance cycle.
|
| |
|
| |
|
|
|
|
| |
What We Don’t Do
|
|
|
✘
|
| |
We do not provide tax gross ups.
|
| |
✘
|
| |
We do not pay dividends or dividend equivalents on unearned RSUs or PSUs until they vest.
|
|
|
✘
|
| |
We do not recycle shares withheld for taxes.
|
| |
✘
|
| |
We do not reprice underwater equity awards.
|
|
|
✘
|
| |
We do not permit pledging or hedging of Company securities.
|
| |
✘
|
| |
We do not have pension or supplemental executive retirement plans.
|
|
|
44
|
Proxy Statement
|
|
45
|
Proxy Statement
|
|
•
|
| |
Altra Industrial Motion Corp.
|
| |
•
|
| |
Littelfuse, Inc.
|
|
|
•
|
| |
Chart Industries, Inc.
|
| |
•
|
| |
LSI Industries Inc.
|
|
|
•
|
| |
Encore Wire Corporation
|
| |
•
|
| |
Powell Industries, Inc.
|
|
|
•
|
| |
ESCO Technologies Inc.
|
| |
•
|
| |
Preformed Line Products Company
|
|
|
•
|
| |
L.B. Foster Company
|
| |
•
|
| |
Team, Inc.
|
|
|
•
|
| |
Franklin Electric Co., Inc.
|
| |
•
|
| |
Valmont Industries, Inc.
|
|
|
•
|
| |
Generac Holdings, Inc.
|
| |
•
|
| |
Woodward, Inc.
|
|
|
•
|
| |
Haynes International, Inc.
|
| |
|
| |
|
|
|
•
|
| |
The executive’s contributions and performance
|
| |
•
|
| |
Market levels of compensation for positions comparable to the executive’s position
|
|
|
•
|
| |
The executive’s roles and responsibilities, including the executive’s tenure in such role
|
| |
•
|
| |
The executive’s experience and management responsibilities
|
|
|
46
|
Proxy Statement
|
|
Category
|
| |
Compensation Element
|
| |
Description
|
|
|
Cash
|
| |
Base Salary
|
| |
Fixed cash compensation based upon experience and on responsibilities of the position. Reviewed annually for potential adjustments based on market rates for each position, individual performance and scope of responsibilities.
|
|
|
Annual Incentive Opportunity
|
| |
Annual cash incentive for achievement of specific annual financial operating results and a qualitative component relating to managing operations and liquidity during a COVID disrupted year.
|
| |||
|
Long-Term Incentives
|
| |
Restricted Stock Units
|
| |
Vest ratably over a three-year period. Settled in shares of AZZ common stock. Dividend equivalents accrue with respect to dividends awarded during the vesting period and will not be paid unless and until the underlying award vests.
|
|
|
Performance Share Units
|
| |
Three-year pre-determined financial performance metric settled in shares of AZZ common stock. Dividend equivalents accrue during the vesting period and will vest if, and when the PSUs to which such dividend equivalents relate become vested.
|
| |||
|
Retirement
|
| |
401(k) Plan
|
| |
Qualified 401(k) plan available to all U.S. employees. The Company matches 100% of the first 1: and 50% of contributions between 2% and 6% (with a potential total Company match of 3.5%).
|
|
|
47
|
Proxy Statement
|
|
Category
|
| |
Compensation Element
|
| |
Description
|
|
|
Other
|
| |
Employment Agreements
|
| |
Sets standard benefits for certain NEOs in the event of termination of employment from the Company.
|
|
|
Severance Plan
|
| |
Sets standard benefits for executives in the event of severance and is available to all U.S. employees (other than NEOs with employment agreements).
|
| |||
|
Change-in-Control Agreements
|
| |
Sets standard benefits for senior executives upon a change-in-control.
|
| |||
|
Other Benefits
|
| |
Executive supplemental disability insurance, financial planning services and annual physical exam.
|
|
•
|
market data and advisory services periodically provided by Meridian, the compensation committee’s external compensation consultant;
|
•
|
internal data regarding the executive’s compensation, both individually and relative to other executive officers; and
|
•
|
individual performance of the executive.
|
|
Name
|
| |
FY2020 Base
Salary
|
| |
FY2021 Base
Salary
|
| |
Actual Base
Salary Earned
During FY2021
|
|
|
Thomas E. Ferguson
|
| |
$746,235
|
| |
$746,235
|
| |
$746,235
|
|
|
Paul W. Fehlman
|
| |
$395,484
|
| |
$395,484
|
| |
$98,871(1)
|
|
|
Philip Schlom(2)
|
| |
—(2)
|
| |
$350,000(3)
|
| |
$317,833
|
|
|
Tara D. Mackey
|
| |
$361,471
|
| |
$361,471
|
| |
$361,471
|
|
|
Gary Hill
|
| |
$344,780
|
| |
$355,000(4)
|
| |
$348,396
|
|
|
Bryan Stovall(2)
|
| |
—(2)
|
| |
$350,000(5)
|
| |
$333,413
|
|
(1)
|
This amount has been pro-rated for three months of the fiscal year due to Mr. Fehlman’s separation of employment from the Company on May 31, 2020.
|
(2)
|
Messrs. Schlom and Stovall were not NEOs during fiscal year 2020.
|
(3)
|
Mr. Schlom’s base salary was increased from $306,000 to $350,000 as a result of being promoted to the Company’s Chief Financial Officer on November 4, 2020.
|
(4)
|
Mr. Hill’s base salary was increased from $344,780 to $355,000 as a result of being promoted to Chief Operating Officer – Infrastructure Solutions on October 8, 2020.
|
(5)
|
Mr. Stovall’s base salary was increased from $300,240 to $350,000 as a result of being promoted to Chief Operating Officer – Metal Coatings on July 2, 2020.
|
|
48
|
Proxy Statement
|
|
Mr. Ferguson
|
| |
Performance Results
|
| |||
|
FY2021 Performance Results
|
| |
•
|
| |
Successfully led the Company and protected liquidity during a COVID disrupted year;
|
|
|
•
|
| |
Effectively led AZZ in streamlining its core businesses to increase operating efficiencies, including the disposition of two non-core businesses and drove acquisition opportunities to execute AZZ’s growth strategy;
|
| |||
|
•
|
| |
Ensured the remediation of two material weaknesses relating to internal control over financial reporting;
|
| |||
|
•
|
| |
Drove initiatives to manage the Electrical platform to reduce risk and improve profitability;
|
| |||
|
•
|
| |
Continued to increase diversity and ensure high performance and accountability among the executive team to support our commitment to long-term growth, development of our people and sustainability; and
|
| |||
|
•
|
| |
Strengthened the existing succession plan currently in place for all senior positions within AZZ.
|
| |||
|
Mr. Schlom
|
| |
Performance Results
|
| |||
|
FY2021 Performance Results
|
| |
•
|
| |
Drove remediation efforts relating to the material weakness in the internal controls over financial reporting;
|
|
|
•
|
| |
Worked closely with the management team and Internal Audit to reduce the number of outstanding audit findings/deficiencies;
|
| |||
|
•
|
| |
Managed liquidity during a COVID disrupted year;
|
| |||
|
•
|
| |
Successfully rebuilt the Corporate Finance Team and managed the duties of the chief accounting and chief financial officer roles through-out the year;
|
| |||
|
•
|
| |
Led a cross functional team to effectively refinance $125 million notes, saving Company $2.5M in annual interest;
|
| |||
|
•
|
| |
Partnered with operations and legal leadership to negotiate flat broker fees and insurance premiums from the prior year in a market experiencing 15-20% rate increases as the norm; and
|
| |||
|
•
|
| |
Reduced tax reporting and tax reserve risks for the Company.
|
|
|
49
|
Proxy Statement
|
|
Ms. Mackey
|
| |
Performance Results
|
| |||
|
FY2021 Performance Results
|
| |
•
|
| |
Managed all legal matters for the Company and defended the business units and resolved numerous labor and employment charges, lawsuits and whistleblower allegations with no material settlement payouts;
|
|
|
•
|
| |
Led the Company’s ESG commitments, including the establishment of a Sustainability Council, adoption of new environmental and human rights policies, engaged a licensed environmental management system to aggregate the Company’s utility data and carbon emissions to assist in tracking the Company’s base-line key performance indicators, and added Board oversight of the Company’s ESG policies and practices;
|
| |||
|
•
|
| |
Absorbed the work of two (2) previous in-house attorneys this year (resulting in year-over-year annual head count savings of $860K);
|
| |||
|
•
|
| |
Prepared the Company’s initial Human Capital Management and ESG disclosures and anaystics;
|
| |||
|
•
|
| |
Managed all AZZ Cares Foundation applications, issuance of assistance and the disbursement of annual tax statements;
|
| |||
|
•
|
| |
Partnered with Finance to refinance $125M in Senior Notes, saving AZZ $2.5M in annual interest expense; and
|
| |||
|
•
|
| |
Partnered with finance to negotiate flat broker fees and insurance premiums from the prior year in a market experiencing 15-20% rate increases as the norm.
|
| |||
|
Mr. Hill
|
| |
Performance Results
|
| |||
|
FY2021 Performance Results
|
| |
•
|
| |
Successfully led AZZ’s Infrastructure Solutions segment in a COVID disrupted year;
|
|
|
•
|
| |
Successfully led the divestiture of the SMS business unit to Mid-State Machine and Fabrication;
|
| |||
|
•
|
| |
Completed the build out of a new Welding Solutions Center in Radom Poland within schedule and budget and entering fiscal year 2022 with backlog for the new facility;
|
| |||
|
•
|
| |
Sustained a safety culture across the businesses to attain a 0.0 TRIR for the Industrial platform and 0.95 TRIR for the Electrical platform for fiscal year 2021;
|
| |||
|
•
|
| |
Continued to develop the Industrial platform leadership depth through succession planning and targeted training; and
|
| |||
|
•
|
| |
Sustained a Customer Satisfaction Score above 9 (on a scale of 10) across the Industrial businesses.
|
| |||
|
Mr. Stovall
|
| |
Performance Results
|
| |||
|
FY2021 Performance Results
|
| |
•
|
| |
Successfully led AZZ’s Metal Coating segment that achieved 95% of its FY2021 operating income plan at a 23.5% margin (Galvanizing at 25.5%) despite a COVID disrupted year;
|
|
|
•
|
| |
Constructed a new Galvanizing Spin Facility in Houston, TX;
|
| |||
|
•
|
| |
Continued to develop the bench strength and leadership of the Metal Coatings segment;
|
| |||
|
•
|
| |
Acquired and successfully integrated ACME Galvanizing and Plating in January 2021; and
|
| |||
|
•
|
| |
Reduced Metal Coatings TRIR and DART by 24% and 40%, respectively, through plant Safety Teams, Mentor Program, and T.R.A.I.T.S. Recognition Plan.
|
|
|
50
|
Proxy Statement
|
|
Named Executive Officer
|
| |
FY2021 Target %(1)
|
|
|
Thomas E. Ferguson
|
| |
100%
|
|
|
Paul W. Fehlman
|
| |
65%
|
|
|
Philip A. Schlom
|
| |
65%
|
|
|
Tara D. Mackey
|
| |
55%
|
|
|
Gary Hill
|
| |
55%
|
|
|
Bryan Stovall
|
| |
55%
|
|
(1)
|
The target payout percentages noted above were adjusted by the compensation committee during the beginning of the fiscal quarter to pay at 80% of the target percentages upon the achievement of 100% of the performance metrics set for fisal year 2021 and discussed in detail below. The maximum payout permitted under the STI Plan was also reduced from 200% to 125% of the target percentages noted above.
|
•
|
increasing the minimum threshold for a potential payout of any cash incentive award from 50% to 60%;
|
•
|
reducing the maximum total potential payout opportunity from 200% to 125%;
|
•
|
creating a discretionary qualitative component, whereby the compensation committee could reduce or increase payouts by 25% for corporate employees and 10% for the Company’s business segment employees based on the successful management of liquidity and completion of strategic projects;
|
•
|
setting the EPS performance metric at $2.00 per share;
|
•
|
Corporate STI Plan participant metrics were adjusted to be based solely on EPS; and
|
•
|
adjusting the weights of the performance award targets for the Company’s business segments participants to be weighted at 50% on EPS, 25% on ROI and 25% OI.
|
|
51
|
Proxy Statement
|
|
% of Performance
Target Achievement
|
| |
% of Target Bonus Opportunity
Earned
|
|
|
<60
|
| |
0%
|
|
|
100
|
| |
80%(1)
|
|
|
110
|
| |
120%
|
|
(1)
|
The target payout on the achievement of the target percentages noted above was adjusted by the compensation committee to pay the bonus opportunity at 80% upon the achievement of 100% of the performance metrics.
|
|
Named Executive Officer
|
| |
Weight
|
| |
Performance Measure
|
| |
FY2021
Target
Performance
Goal
|
| |
FY2021
Achieved
Performance
|
| |
% of
Target
Performance
Achieved
|
|
|
Mr. Ferguson
|
| |
100%
|
| |
Adjusted Diluted earnings per share (“EPS”)
|
| |
$2.00
|
| |
$2.11
|
| |
106%
|
|
|
Mr. Schlom
|
| |
100%
|
| |
EPS
|
| |
$2.00
|
| |
$2.11
|
| |
106%
|
|
|
Mr. Fehlman
|
| |
100%
|
| |
EPS
|
| |
$2.00
|
| |
$2.11
|
| |
106%
|
|
|
Ms. Mackey
|
| |
100%
|
| |
EPS
|
| |
$2.00
|
| |
$2.11
|
| |
106%
|
|
|
Mr. Hill
|
| |
50%
|
| |
EPS
|
| |
$2.00
|
| |
$2.11
|
| |
106%
|
|
|
25%
|
| |
Industrial Platform ROA(1)
|
| |
5.30%
|
| |
0%
|
| |
0%
|
| |||
|
25%
|
| |
Industrial Platform Operating Income(2)
|
| |
(3)
|
| |
(3)
|
| |
0%
|
| |||
|
Mr. Stovall
|
| |
50%
|
| |
EPS
|
| |
$2.00
|
| |
$2.11
|
| |
106%
|
|
|
25%
|
| |
Metal Coatings Platform ROA(1)
|
| |
14.40%
|
| |
16.10%
|
| |
112%
|
| |||
|
25%
|
| |
Metal Coatings Platform Operating Income(2)
|
| |
(4)
|
| |
(4)
|
| |
109%
|
|
(1)
|
Platform ROA is calculated as a percentage using a numerator of tax adjusted platform operating income, divided by a denominator of total platform assets, minus platform current liabilities, plus platform current portion of long-term debt.
|
(2)
|
Platform operating income consists of net sales less cost of sales, specifically identifiable selling, general and administrative expenses and other income and expense items that are specifically identifiable to a platform.
|
(3)
|
The fiscal year 2021 operating income target and achieved performance for the Industrial platform is not disclosed because such disclosure would result in competitive harm. This operating income target was set at a level necessary to deliver on AZZ’s financial goals and intended to be challenging. The compensation committee believes that the achievement of the operating income target was exceptionally challenging in a COVID disrupted year and required substantial performance by the Industrial platform.
|
(4)
|
The fiscal year 2021 operating income target and achieved performance for the Metal Coatings platform is not disclosed because such disclosure would result in competitive harm. This operating income target was set at a level necessary to deliver on AZZ’s financial goals and intended to be challenging. The compensation committee believes that the achievement of the operating income target was exceptionally challenging in a COVID disrupted year and required substantial performance by the Metal Coatings platform.
|
|
52
|
Proxy Statement
|
|
Named Executive Officer
|
| |
Target as a %
of Base Salary
|
| |
Actual Payout
as % of Base
Salary
(1)
|
| |
Target Amount
($)(2)
|
| |
Actual Payout
($)(3)
|
|
|
Thomas Ferguson
|
| |
100%
|
| |
104%
|
| |
596,988
|
| |
776,084
|
|
|
Paul Fehlman
|
| |
65%
|
| |
104%
|
| |
205,652
|
| |
66,837
|
|
|
Philip Schlom
|
| |
65%
|
| |
104%
|
| |
165,793
|
| |
214,855
|
|
|
Tara D. Mackey
|
| |
55%
|
| |
104%
|
| |
159,047
|
| |
206,761
|
|
|
Gary Hill
|
| |
55%
|
| |
52%
|
| |
153,015
|
| |
100,024
|
|
|
Bryan Stovall
|
| |
55%
|
| |
111%
|
| |
146,702
|
| |
203,549
|
|
(1)
|
The target payout on the achievement of the target percentages for fiscal year 2021 was adjusted by the compensation committee to pay the bonus opportunity at 80% upon the achievement of 100% of the performance metrics. Each percentage point achieved over 100% increased the target bonus earned by four percentage points. The achievement of 106% increased the earned bonus amount by 24% (six percentage points multiplied by four), which resulted in a payout percentage of 104% (80% plus 24%).
|
(2)
|
The target amount is calculated based on 80% of the base salary, which reflects the compensation committee’s adjustment to pay the bonus opportunity at 80% upon the achievement of 100% of the performance metrics.
|
(3)
|
Actual payout was pro-rated for Messrs. Schlom, Hill and Stovall based upon their change in base salary during the fiscal year related to promotions, or in the case of Mr. Fehlman, his separation from the Company. Mr. Schlom’s target percentage increased from 50% to 65% due to his promotion to chief financial officer.
|
•
|
align the interests of executive officers with those of our shareholders;
|
•
|
provide an opportunity for increased equity ownership in the Company by directors and executives;
|
•
|
maintain competitive levels of total compensation with the Company’s industry peer group; and
|
•
|
facilitate compliance with the policy of the board of directors, as described above under the heading “Stock Ownership Guidelines,” requiring AZZ’s executive officers and directors to hold shares of AZZ’s common stock.
|
|
53
|
Proxy Statement
|
•
|
the practice of granting annual equity awards only once every year after annual final results are released;
|
•
|
the emphasis placed on equity in the mix of total compensation;
|
•
|
the officer’s experience and performance;
|
•
|
the scope, responsibility and business impact of the NEO’s position;
|
•
|
the perceived retention value of the total compensation package in light of the competitive labor market;
|
•
|
alignment with AZZ's compensation philosophy and objectives;
|
•
|
cost and dilution impact;
|
•
|
grant practices of our Executive Compensation Peer Group; and
|
•
|
input and advice from Meridan, our executive compensation consultant.
|
|
TSR is
|
| |
(Ending Share Price – Beginning Share Price) + Dividends Paid
|
|
|
(Beginning Share Price)
|
|
|
| |
|
| |
|
1 — (
|
| |
AZZ Position in Ranking — 1
|
| |
)
|
|
|
| ||||
|
|
| ||||
|
# of companies in Peer Group excluding AZZ
|
| ||||
|
| |
|
| |
|
|
54
|
Proxy Statement
|
|
TSR
% Ranking Achieved(1)
|
| |
% of Target Award
Payout
|
|
|
<25%
|
| |
0%
|
|
|
25%
|
| |
50%
|
|
|
50%
|
| |
100%
|
|
|
100%
|
| |
200%
|
|
(1)
|
The percentage of target payout earned under the FY2021 PSUs will be interpolated for performance percentiles that fall between the threshold and maximum percentages shown above.
|
|
Name
|
| |
RSU Grant
Value(1)
|
| |
Number of
RSUs
|
| |
Total PSU
Grant Value(1)
|
| |
Number of
PSUs at
Target
|
|
|
Thomas Ferguson
|
| |
$750,000
|
| |
27,184
|
| |
$750,000
|
| |
27,184
|
|
|
Philip Schlom
|
| |
$112,500
|
| |
4,078
|
| |
$112,500
|
| |
4,078
|
|
|
Paul Fehlman
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
Tara D. Mackey
|
| |
$150,000
|
| |
5,437
|
| |
$150,000
|
| |
5,437
|
|
|
Gary Hill
|
| |
$125,000
|
| |
4,531
|
| |
$125,000
|
| |
4,531
|
|
|
Bryan Stovall
|
| |
$150,000
|
| |
5,437
|
| |
$100,000
|
| |
3,625
|
|
(1)
|
Grant values vary from the values in the Summary Compensation Table because grant values represent the dollar value of the grant that the compensation committee desired to award, which was then divided by the 30-day average closing stock price of the Company’s common stock on the last trading day preceding the date of grant to determine the number of shares awarded and the values in the Summary Compensation Table represent the fair market value of the award calculated by the different methodology as set forth in FASB ASC Topic 718.
|
|
55
|
Proxy Statement
|
|
56
|
Proxy Statement
|
|
57
|
Proxy Statement
|
|
Position
|
| |
Ownership Requirement
|
| |
Maximum Number of
Shares Required
|
|
|
Chief Executive Officer
|
| |
4 x Base Salary
|
| |
100,000
|
|
|
Chief Financial Officer, Chief Operating Officer and Senior Vice Presidents
|
| |
3 x Base Salary
|
| |
30,000
|
|
|
Vice Presidents and other Officers
|
| |
1 x Base Salary
|
| |
7,500
|
|
|
58
|
Proxy Statement
|
|
59
|
Proxy Statement
|
|
| |
THE COMPENSATION COMMITTEE
|
|
| |
|
|
| |
Ed McGough, Chairman
Daniel E. Berce
Daniel R. Feehan
Clive A. Grannum
Carol R. Jackson
Venita McCellon-Allen
|
|
60
|
Proxy Statement
|
|
Name and
Principal Position
|
| |
Year
|
| |
Salary
($)
|
| |
Bonus
($)
|
| |
Stock
Awards/
RSUs
($)(1)
|
| |
Option
/SARs
Awards
($)
|
| |
Non-Equity
Incentive
Plan
Compensation
($)(2)
|
| |
Change in
Pension Value
and Nonquali-
fied Deferred
Compensation
Earnings
($)
|
| |
All Other
Compensation
($)(3)
|
| |
Total
($)
|
|
|
|
| |||||||||||||||||||||||||||
|
Thomas E. Ferguson
President & Chief Executive Officer
|
| |
2021
|
| |
746,235
|
| |
—
|
| |
1,680,786
|
| |
—
|
| |
776,084
|
| |
—
|
| |
20,883
|
| |
3,223,988
|
|
|
2020
|
| |
746,235
|
| |
—
|
| |
1,500,000
|
| |
—
|
| |
1,137,262
|
| |
—
|
| |
28,707
|
| |
3,412,204
|
| |||
|
2019
|
| |
724,500
|
| |
—
|
| |
1,200,000
|
| |
—
|
| |
844,767
|
| |
—
|
| |
13,458
|
| |
2,782,725
|
| |||
|
|
| |||||||||||||||||||||||||||
|
Philip Schlom
Senior Vice President & Chief Financial Officer
|
| |
2021
|
| |
317,833(4)
|
| |
|
| |
304,493
|
| |
—
|
| |
214,855
|
| |
—
|
| |
99,203
|
| |
936,384
|
|
|
2020
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |||
|
2019
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |||
|
|
| |||||||||||||||||||||||||||
|
Paul W. Fehlman(5)
Former Senior Vice President & Chief Financial Officer
|
| |
2021
|
| |
98,871
|
| |
—
|
| |
—
|
| |
—
|
| |
66,837
|
| |
—
|
| |
352,178(6)
|
| |
517,886
|
|
|
2020
|
| |
395,484
|
| |
—
|
| |
450,000
|
| |
—
|
| |
391,766
|
| |
—
|
| |
14,583
|
| |
1,251,833
|
| |||
|
2019
|
| |
387,729
|
| |
50,000
|
| |
450,000
|
| |
—
|
| |
293,860
|
| |
—
|
| |
16,964
|
| |
1,198,553
|
| |||
|
|
| |||||||||||||||||||||||||||
|
Tara D. Mackey
Chief Legal Officer
& Secretary
|
| |
2021
|
| |
361,471
|
| |
—
|
| |
336,170
|
| |
—
|
| |
206,761
|
| |
—
|
| |
3,593
|
| |
907,995
|
|
|
2020
|
| |
361,471
|
| |
—
|
| |
300,000
|
| |
—
|
| |
302,985
|
| |
—
|
| |
11,921
|
| |
976,377
|
| |||
|
2019
|
| |
349,247
|
| |
50,000
|
| |
300,000
|
| |
—
|
| |
223,972
|
| |
—
|
| |
6,448
|
| |
929,667
|
| |||
|
|
| |||||||||||||||||||||||||||
|
Gary Hill
Chief Operating Officer – Infrastructure Solutions
|
| |
2021
|
| |
348,396
|
| |
—
|
| |
280,152
|
| |
—
|
| |
100,024
|
| |
—
|
| |
50,066
|
| |
778,638
|
|
|
2020
|
| |
344,780
|
| |
—
|
| |
1,446,250
|
| |
—
|
| |
313,836
|
| |
—
|
| |
27,117
|
| |
2,131,983
|
| |||
|
2019
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |||
|
|
| |||||||||||||||||||||||||||
|
Bryan Stovall
Chief Operating Officer – Metal Coatings
|
| |
2021
|
| |
333,413(7)
|
| |
—
|
| |
275,976
|
| |
—
|
| |
203,549
|
| |
—
|
| |
3,890
|
| |
816,828
|
|
|
2020
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |||
|
2019
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
(1)
|
The amounts in this column represent the grant date fair value of the RSU and PSU awards at target performance, calculated pursuant to FASB ASC Topic 718. For PSU awards based on relative TSR, the fair value is estimated on the date of grant based on a multifactor Monte Carlo valuation model that simulates our stock price and TSR relative to the Company’s Executive Compensation Peer Group. PSUs vest at the end of a three-year performance cycle with payouts ranging from 0% to 200% for the relative TSR component. For more information on the calculations used to determine stock-based compensation, please see Note 11 of the Company’s Annual Report on Form 10-K for the year ended February 28, 2021 filed with the SEC on April 23, 2021.
|
(2)
|
The amounts in this column reflect the cash awards granted under the Company’s STI Plan.
|
(3)
|
All other compensation in column (i) consists of the perquisites as described in the table below entitled “Perquisites” on a per executive basis for fiscal year 2021.
|
(4)
|
Mr. Schlom’s base salary was pro-rated based upon his promotion to Senior Vice President, Chief Financial Officer on October 29, 2020.
|
(5)
|
Mr. Fehlman served as the Company’s senior vice president, chief financial officer until May 31, 2020.
|
(6)
|
This amount reflects a severance payment of $296,613 and accrued vacation in the amount of $45,634.
|
(7)
|
Mr. Stovall’s base salary was pro-rated based upon his promotion to Chief Operating Officer – Metal Coatings on July 2, 2020.
|
|
61
|
Proxy Statement
|
|
|
| |
Perquisites
|
| ||||||||||||||||||
|
Name
|
| |
Contribution
to 401(k)
Plan
($)(1)
|
| |
Insurance
Benefits
($)(2)
|
| |
Club
Dues
($)
|
| |
Physical
Exams
($)
|
| |
Life
Insurance
Policy
($)
|
| |
All Other
Perquisites
($)
|
| |
Total
($)
|
|
|
Thomas E. Ferguson
|
| |
10,920
|
| |
3,079
|
| |
540
|
| |
1,700
|
| |
—
|
| |
4,644(3)
|
| |
20,883
|
|
|
Paul W. Fehlman
|
| |
8,245
|
| |
597
|
| |
1,089
|
| |
—
|
| |
—
|
| |
342,247(4)
|
| |
352,178
|
|
|
Philip Schlom
|
| |
11,801
|
| |
—
|
| |
2,659
|
| |
—
|
| |
—
|
| |
84,743(5)
|
| |
99,203
|
|
|
Tara D. Mackey
|
| |
1,581
|
| |
2,012
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
3,593
|
|
|
Gary Hill
|
| |
9,939
|
| |
2,317
|
| |
—
|
| |
—
|
| |
587
|
| |
37,223(5)
|
| |
50,066
|
|
|
Bryan Stovall
|
| |
1,314
|
| |
2,576
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
3,890
|
|
(1)
|
Matching 401(k) contributions allocated by the Company during fiscal year 2021 to each of the NEOs pursuant to the Company’s Benefit Plan (which is more fully described on page 56 under the heading “Retirement and Other Benefits”).
|
(2)
|
The value attributable to each of the NEOs pursuant to the AZZ Supplemental Individual Disability Insurance Plan.
|
(3)
|
This amount represents fees for financial planning services.
|
(4)
|
This aggregate amount includes a severance payment of $296,613 and accrued vacation in the amount of $45,634 paid upon Mr. Fehlman’s separation from the Company on May 31, 2020.
|
(5)
|
These amounts represent the aggregate value of relocation services provided to each of Messrs. Schlom and Hill in connection with relocating their households to Fort Worth, Texas.
|
|
62
|
Proxy Statement
|
|
|
| |
|
| |
Estimated Future Payouts Under
Non- Equity Incentive Plan
Awards(1)
|
| |
Estimated Future Payouts
Under Equity Incentive
Plan Awards(2)
|
| |
All Other
Stock/
RSU
Awards:
Number
of Shares
of Stock
or Units
(#)(3)
|
| |
All Other
Option/
SARs
Awards:
Number of
Securities
Underlying
Options/
SARs
(#)(4)
|
| |
Exercise
or Base
Price of
Option/
SARs
Awards
($/sh)
|
| |
Grant
Date Fair
Value of
Stock/RSU
and Option/
SARs
Awards
($)(5)
|
| ||||||||||||
|
Name
|
| |
Grant
Date
|
| |
Threshold
($)
|
| |
Target
($)
|
| |
Maximum
($)
|
| |
Threshold
(#)
|
| |
Target
(#)
|
| |
Maximum
(#)
|
| ||||||||||||
|
|
| |||||||||||||||||||||||||||||||||
|
Thomas E. Ferguson
|
| |
3/1/20
|
| |
0
|
| |
596,988
|
| |
932,794
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
5/4/20
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
27,184
|
| |
—
|
| |
—
|
| |
777,734
|
| |||
|
5/4/20
|
| |
—
|
| |
—
|
| |
—
|
| |
0
|
| |
27,184
|
| |
54,368
|
| |
—
|
| |
—
|
| |
—
|
| |
903,052
|
| |||
|
|
| |||||||||||||||||||||||||||||||||
|
Philip Schlom
|
| |
3/1/20
|
| |
0
|
| |
165,793
|
| |
284,375
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
5/4/20
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
4,078
|
| |
—
|
| |
—
|
| |
116,672
|
| |||
|
5/4/20
|
| |
—
|
| |
—
|
| |
—
|
| |
0
|
| |
4,078
|
| |
8,156
|
| |
—
|
| |
—
|
| |
—
|
| |
135,471
|
| |||
|
10/16/20(6)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
1,500
|
| |
—
|
| |
—
|
| |
52,350
|
| |||
|
|
| |||||||||||||||||||||||||||||||||
|
Paul W. Fehlman
|
| |
3/1/20
|
| |
0
|
| |
205,652
|
| |
321,331
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
|
| |||||||||||||||||||||||||||||||||
|
Tara D. Mackey
|
| |
3/1/20
|
| |
0
|
| |
159,047
|
| |
248,511
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
5/4/20
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
5,437
|
| |
—
|
| |
—
|
| |
155,553
|
| |||
|
5/4/20
|
| |
—
|
| |
—
|
| |
—
|
| |
0
|
| |
5,437
|
| |
10,874
|
| |
—
|
| |
—
|
| |
—
|
| |
180,617
|
| |||
|
|
| |||||||||||||||||||||||||||||||||
|
Gary Hill
|
| |
3/1/20
|
| |
0
|
| |
153,015
|
| |
244,063
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
5/4/20
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
4,531
|
| |
—
|
| |
—
|
| |
129,632
|
| |||
|
5/4/20
|
| |
—
|
| |
—
|
| |
—
|
| |
0
|
| |
4,531
|
| |
9,062
|
| |
—
|
| |
—
|
| |
—
|
| |
150,520
|
| |||
|
|
| |||||||||||||||||||||||||||||||||
|
Bryan Stovall
|
| |
3/1/20
|
| |
0
|
| |
146,702
|
| |
240,625
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
5/4/20
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
5,437
|
| |
—
|
| |
—
|
| |
155,553
|
| |||
|
5/4/20
|
| |
—
|
| |
—
|
| |
—
|
| |
0
|
| |
3,625
|
| |
7,250
|
| |
—
|
| |
—
|
| |
—
|
| |
120,423
|
|
(1)
|
Possible payouts to each NEO under the Company’s Senior Management Bonus Plan for fiscal year 2021.
|
(2)
|
In fiscal year 2021, long-term equity incentive grants included PSUs, which will vest at the end of three years, if at all, based on relative TSR performance during the performance cycle (March 1, 2020 to February 28, 2023) as compared to the Company’s Executive Compensation Peer Group, with payouts ranging from 0% to 200%. The PSUs granted accrue dividend equivalents during the performance cycle, which will be paid either in cash or shares of AZZ common stock at the discretion of the compensation committee upon the vesting of the underlying award. For PSU awards based on relative TSR, the fair value is estimated on the date of grant based on a multifactor Monte Carlo valuation model that simulates our stock price and TSR relative to our Executive Compensation Peer Group.
|
(3)
|
Number of RSUs granted to the NEOs under the 2014 Plan. These RSUs vest ratably over a three-year period beginning on the first anniversary of the grant date. The RSUs granted accrue dividend equivalents during the restricted vesting period, which will be paid either in cash or shares of AZZ common stock at the discretion of the compensation committee upon the vesting of the underlying award.
|
(4)
|
Beginning in fiscal year 2016, SARs were no longer granted as a component of the Company’s executive compensation program. The final vesting date for any outstanding SARs awarded under the 2005 Plan was on March 1, 2017, with an expiration date on or before May 1, 2021 for all such unexercised SARs. Two of the Company’s executive officers have unexercised SARs.
|
(5)
|
The amounts in this column for the fiscal year ended February 28, 2021 reflect the aggregate grant date fair market value calculated in accordance with FASB ASC Topic 718 for RSU and PSU awards granted to the NEOs under the 2014 Plan. Assumptions used in the calculation of this amount are included in Note 11 to the Company’s audited financial statements for the fiscal year ended February 28, 2021, included in the Company’s Annual Report on Form 10-K filed with the SEC on April 23, 2021.
|
(6)
|
Mr. Schlom received a special one-time equity award of 1,500 RSUs on October 16, 2020 that will cliff vest in full on October 16, 2021. The fair market value of $52,350 is based upon the closing market price of AZZ’s common stock on October 16, 2020, which was $34.90.
|
|
63
|
Proxy Statement
|
|
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END TABLES
|
| |||||||||||||||
|
OPTION/SAR AWARDS
|
| |||||||||||||||
|
Name
|
| |
Grant Date
|
| |
Number of
Securities
Underlying
Unexercised
Options/SARs
Exercisable
(#)(1)
|
| |
Number of
Securities
Underlying
Unexercised
Options/SARs
Unexercisable
(#)(2)
|
| |
Option/SARs
Exercise
Price
($)
|
| |
Option/SARs
Expiration
Date
(3)
|
|
|
Thomas E. Ferguson
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
Philip Schlom
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
Paul W. Fehlman
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
Tara D. Mackey
|
| |
5/01/14(4)
|
| |
2,711
|
| |
—
|
| |
44.15
|
| |
5/01/21
|
|
|
Gary Hill
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
Bryan Stovall
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
(1)
|
Amounts in this column represent vested but unexercised SAR awards.
|
(2)
|
All of the SARs granted to the NEOs have fully vested. Beginning in fiscal year 2016, SARs were no longer granted as a component of the Company’s executive compensation program. The final vesting date for outstanding SARs awarded under the 2005 Plan was on March 1, 2017.
|
(3)
|
The SARs have a seven-year term from the grant date.
|
(4)
|
The SARs listed were granted on May 1, 2014 and vested and became exercisable over a three-year period with one-third of the SARs vesting on March 1, 2015, March 1, 2016 and March 1, 2017. All unexercised SARs will expire on May 1, 2021.
|
|
64
|
Proxy Statement
|
|
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END TABLES
|
| |||||||||||||||
|
STOCK AWARDS
|
| |||||||||||||||
|
Name
|
| |
Grant Date
|
| |
Number of
Shares or Units
of Stock That
Have Not
Vested
(#)(1)(2)
|
| |
Market Value of
Shares or Units of
Stock That Have
Not Vested
($)(3)
|
| |
Equity
Incentive Plan
Awards:
Number of
Unearned
Shares, Units
or Other
Rights That
Have Not
Vested
(#)(4)
|
| |
Equity
Incentive Plan
Awards:
Market or
Payout Value
of Unearned
Shares, Units
or Other
Rights That
Have Not
Vested
($)(3)
|
|
|
|
| |||||||||||||||
|
Thomas E. Ferguson
|
| |
05/18/18
|
| |
4,978
|
| |
254,326
|
| |
14,935
|
| |
763,029
|
|
|
05/22/19
|
| |
11,845
|
| |
605,161
|
| |
17,768
|
| |
907,767
|
| |||
|
05/04/20
|
| |
27,704
|
| |
1,415,397
|
| |
27,704
|
| |
1,415,397
|
| |||
|
|
| |||||||||||||||
|
Philip Schlom
|
| |
05/04/20
|
| |
4,156
|
| |
212,330
|
| |
4,156
|
| |
212,330
|
|
|
10/16/20(5)
|
| |
1,512
|
| |
77,248
|
| |
—
|
| |
—
|
| |||
|
|
| |||||||||||||||
|
Paul W. Fehlman(6)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
|
| |||||||||||||||
|
Tara D. Mackey
|
| |
05/18/18
|
| |
1,245
|
| |
63,607
|
| |
3,733
|
| |
190,719
|
|
|
05/22/19
|
| |
2,368
|
| |
120,981
|
| |
3,552
|
| |
181,472
|
| |||
|
05/04/20
|
| |
5,541
|
| |
283,090
|
| |
5,541
|
| |
283,090
|
| |||
|
|
| |||||||||||||||
|
Gary Hill
|
| |
05/18/18
|
| |
1,037
|
| |
52,980
|
| |
3,111
|
| |
158,941
|
|
|
05/22/19
|
| |
1,973
|
| |
100,801
|
| |
2,960
|
| |
151,226
|
| |||
|
05/04/20
|
| |
4,617
|
| |
235,883
|
| |
4,617
|
| |
235,883
|
| |||
|
02/11/20
|
| |
20,382
|
| |
1,041,316
|
| |
—
|
| |
—
|
| |||
|
|
| |||||||||||||||
|
Bryan Stovall
|
| |
05/18/18
|
| |
415
|
| |
21,202
|
| |
—
|
| |
—
|
|
|
05/22/19
|
| |
1,421
|
| |
72,599
|
| |
1,421
|
| |
72,599
|
| |||
|
05/04/20
|
| |
5,541
|
| |
283,090
|
| |
3,694
|
| |
188,726
|
|
(1)
|
Amounts in this column represent RSU awards, which vest ratably over a three-year period from the grant date.
|
(2)
|
The amounts in this column include dividend equivalents, accrued through February 28, 2021, of the underlying equity award that will vest if, and when, the RSUs to which such dividend equivalent relate becomes vested.
|
(3)
|
The fair market value of the RSU and PSU awards is based upon the closing market price of AZZ common stock as of February 26, 2021 (the last trading day of the Company’s fiscal year 2021), which was $51.09.
|
(4)
|
Amounts in this column represent PSUs granted on May 18, 2018, May 22, 2019 and May 4, 2020, which have a three-year performance cycle and will vest and become payable, if at all, on the third anniversary of the grant date. The amounts in this column also include accrued dividend equivalents through February 28, 2021, that will vest if, and when the PSUs to which such dividend equivalents relate become vested.
|
(5)
|
Mr. Schlom was granted a special one-time award in the amount of 1,500 RSUs that will vest in full on October 16, 2021.
|
(6)
|
Mr. Fehlman’s employment with the Company was terminated on May 31, 2020.
|
|
65
|
Proxy Statement
|
|
|
| |
Option/SAR Awards
|
| |
Stock Awards(2)
|
| ||||||
|
Name
|
| |
Number of Shares
Acquired on Exercise(1)
(#)
|
| |
Value Realized
on Exercise
($)
|
| |
Number of Shares
Acquired on Vesting
(#)
|
| |
Value Realized on
Vesting
($)
|
|
|
Thomas E. Ferguson
|
| |
3,421
|
| |
172,555
|
| |
13,324(3)
|
| |
403,837(4)
|
|
|
Philip Schlom
|
| |
—
|
| |
—
|
| |
1,545(5)
|
| |
53,581(6)
|
|
|
Paul W. Fehlman
|
| |
—
|
| |
—
|
| |
1,058(7)
|
| |
30,248(8)
|
|
|
Tara D. Mackey
|
| |
—
|
| |
—
|
| |
2,820(9)
|
| |
85,560(10)
|
|
|
Gary Hill
|
| |
—
|
| |
—
|
| |
10,002(11)
|
| |
327,970(12)
|
|
|
Bryan Stovall
|
| |
87
|
| |
4,244
|
| |
1,367(13)
|
| |
41,566(14)
|
|
(1)
|
Awards exercised were SARs. The value of these SARs did not convert into common stock on a one-for-one basis when exercised. The SARs were settled in shares of AZZ common stock of an amount equal to the excess value of the grant date price over the exercise price.
|
(2)
|
Awards vested were RSUs granted under the Company’s 2014 Plan, which accrue dividend equivalents during the restricted vesting period, and settled in shares of AZZ common stock at the discretion of the compensation committee upon the vesting of the underlying award.
|
(3)
|
This number includes: (i) 2,492 RSUs that vested on April 27, 2020 plus 101 accrued dividend equivalents; (ii) 4,762 RSUs that vested on May 18, 2020 plus 125 accrued dividend equivalents; and (iii) 5,743 RSUs that vested on May 22, 2020 plus 101 accrued dividend equivalents.
|
(4)
|
The value realized upon the vesting of (i) 2,593 RSUs (including accrued dividend equivalents) based on the closing price of our common stock on April 27, 2020 of $28.59; (ii) 4,887 RSUs (including accrued dividend equivalents) based on the closing price of our common stock on May 18, 2020 of $30.06; and (iii) 5,844 RSUs (including accrued dividend equivalents) based on the closing price of our common stock on May 22, 2020 of $31.28.
|
(5)
|
This number includes 1,523 RSUs that vested on October 21, 2020 plus 22 accrued dividend equivalents related to Mr. Schlom’s offer letter of employment, which vested in full one year from the date of grant which was October 21, 2019.
|
(6)
|
The value realized upon the vesting of 1,545 RSUs (including accrued dividend equivalents) based on the closing price of our common stock on October 21, 2020 of $34.68.
|
(7)
|
This number includes 1,017 RSUs that vested on April 27, 2020 plus 41 accrued dividend equivalents.
|
(8)
|
The value realized upon the vesting of 1,058 RSUs (including accrued dividend equivalents) based on the closing price of our common stock on April 27, 2020 of $28.59.
|
(9)
|
This number includes: (i) 415 RSUs that vested on April 27, 2020 plus 16 accrued dividend equivalents; (ii) 1,190 RSUs that vested on May 18, 2020 plus 31 accrued dividend equivalents; and (iii) 1,148 RSUs that vested on May 22, 2020 plus 20 accrued dividend equivalents.
|
(10)
|
The value realized upon the vesting of (i) 431 RSUs (including accrued dividend equivalents) based on the closing price of our common stock on April 27, 2020 of $28.59; (ii) 1,221 RSUs (including accrued dividend equivalents) based on the closing price of our common stock on May 18, 2020 of $30.06; and (iii) 1,168 RSUs (including accrued dividend equivalents) based on the closing price of our common stock on May 22, 2020 of $31.28.
|
(11)
|
This number includes: (i) 415 RSUs that vested on April 27, 2020 plus 16 accrued dividend equivalents; (ii) 992 RSUs that vested on May 18, 2020 plus 26 accrued dividend equivalents; (iii) 957 RSUs that vested on May 22, 2020 plus 16 dividend equivalents; and (iv) 7,500 RSUs that vested on November 1, 2020 plus 80 dividend equivalents.
|
(12)
|
The value realized upon the vesting of (i) 431 RSUs (including accrued dividend equivalents) based on the closing price of our common stock on April 27, 2020 of $28.59; (ii) 1,018 RSUs (including accrued dividend equivalents) based on the closing price of our common stock on May 18, 2020 of $30.06; (iii) 973 RSUs (including accrued dividend equivalents) based on the closing price of our common stock on May 22, 2020 of $31.28; and (iv) 7,580 RSUs (including dividend equivalents) based on the closing price of our common stock on November 1, 2020 of $33.59.
|
(13)
|
This number includes: (i) 249 RSUs that vested on April 27, 2020 plus 10 accrued dividend equivalents; (ii) 397 RSUs that vested on May 18, 2020 plus 10 accrued dividend equivalents; and (iii) 689 RSUs that vested on May 22, 2020 plus 12 accrued dividend equivalents.
|
(14)
|
The value realized upon the vesting of (i) 259 RSUs (including accrued dividend equivalents) based on the closing price of our common stock on April 27, 2020 of $28.59; (ii) 407 RSUs (including accrued dividend equivalents) based on the closing price of our common stock on May 18, 2020 of $30.06; and (iii) 701 RSUs (including accrued dividend equivalents) based on the closing price of our common stock on May 22, 2020 of $31.28.
|
|
66
|
Proxy Statement
|
|
67
|
Proxy Statement
|
•
|
If the executive’s employment is terminated within one year following a change in control by the Company for Cause or by the executive for other than Good Reason, the Company must pay him or her their full base salary through the date of termination plus all other amounts to which he or she is entitled under any compensation or benefit plan of the Company at the time such payments are due, and the Company shall have no further obligation to him or her under the Change in Control Agreement.
|
•
|
If the executive’s employment is terminated before one year following a change in control by the Company other than for Cause or disability, or by the executive for Good Reason, he or she shall be entitled to a lump sum payment of his or her base salary through the date of termination plus any other amounts to which he or she is entitled under any compensation plan of the Company at the time such payments are due; a lump sum severance payment in an amount equal to two (2) times his or her base amount, as defined in Section 280G(b)(3) of the Internal Revenue Code, and the vesting and immediate exercisability of all stock options, RSUs, PSUs and SARs; and reimbursement for all legal fees and expenses incurred in seeking to enforce the Executive Change in Control Severance Agreement.
|
•
|
“Cause” as used in the Executive Change in Control Severance Agreements is defined as (1) conviction of a crime involving moral turpitude or providing for imprisonment, (2) commission of any willful malfeasance or gross negligence in the discharge of his or her duties to the Company or any of its subsidiaries, having a material adverse effect on the Company or any of its subsidiaries or (3) failure to timely correct after written notice, any specific failure in performance of the duties of his or her position with the Company.
|
•
|
“Good Reason” as used in such Executive Change in Control Severance Agreements includes, with respect to each executive:
|
(A)
|
a substantial adverse alteration in the nature or status of his or her responsibilities from those in effect immediately prior to the change in control;
|
(B)
|
a reduction in his or her annual base salary in effect on the date of the change in control;
|
(C)
|
the relocation of the Company’s principal executive offices or the Company's requiring the executive to be based anywhere other than a site less than thirty (30) miles from the site where he or she is now principally based;
|
(D)
|
the failure by the Company, without his or her consent, to pay to him or her any portion of his or her current compensation;
|
(E)
|
the failure by the Company to continue or replace any compensation plan material to his or her total compensation or the failure to continue his or her participation therein on a basis not materially less favorable, as existed at the time of the change in control;
|
|
68
|
Proxy Statement
|
(F)
|
the failure of the Company to continue to provide him or her with benefits substantially similar to those enjoyed by him or her under deferred compensation plans, life insurance, medical, health and accident, or disability or vacation plans or policies in which he or she was participating at the time of the change in control;
|
(G)
|
the failure of the Company to obtain a satisfactory agreement from any successor to assume and agree to perform the Change in Control Severance Agreement; or
|
(H)
|
any purported termination of his or her employment by the Company other than because of total disability, death or for Cause.
|
|
TRIGGERING EVENTS
|
| ||||||||||||||||||||||||
|
|
| |
Termination of Employment Before
Change in Control
|
| |
Termination of Employment Within
Two Years After Change in Control
|
| ||||||||||||||||||
|
|
| |
Death/
Disability
|
| |
Termination
for Cause
|
| |
Termination
Without
Cause
|
| |
Death/
Disability
|
| |
Termination
for Cause
|
| |
Termination
Without
Cause
|
| |
Voluntary For
Good Reason
|
| |
Voluntary
Without
Good Reason
|
|
|
Thomas Ferguson
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
Severance
|
| |
$—
|
| |
$—
|
| |
$2,238,705(1)
|
| |
$—
|
| |
$—
|
| |
$2,231,243(2)
|
| |
$2,231,243(2)
|
| |
$—
|
|
|
Short-Term Cash Incentive(3)
|
| |
$
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
|
|
SARs(4)
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
|
|
RSUs(5)
|
| |
$2,274,884
|
| |
$—
|
| |
$2,274,884
|
| |
$2,274,884
|
| |
$—
|
| |
$2,274,884
|
| |
$2,274,884
|
| |
$—
|
|
|
PSUs(6)
|
| |
$3,086,193
|
| |
$—
|
| |
$3,086,193
|
| |
$3,086,193
|
| |
$—
|
| |
$3,086,193
|
| |
$3,086,193
|
| |
$—
|
|
|
TOTAL
|
| |
$5,361,077
|
| |
$—
|
| |
$7,599,782
|
| |
$5,361,077
|
| |
$—
|
| |
$7,592,320
|
| |
$7,592,320
|
| |
$—
|
|
|
Philip Schlom
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
Severance
|
| |
$—
|
| |
$—
|
| |
$577,500(7)
|
| |
$—
|
| |
$—
|
| |
$1,155,000(8)
|
| |
$1,155,000(8)
|
| |
$—
|
|
|
Short-Term Cash Incentive(3)
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
|
|
SARs(4)
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
|
|
RSUs(5)
|
| |
$289,578
|
| |
$—
|
| |
$289,578
|
| |
$289,578
|
| |
$—
|
| |
$289,578
|
| |
$289,578
|
| |
$—
|
|
|
PSUs(6)
|
| |
$212,330
|
| |
$—
|
| |
$212,330
|
| |
$212,330
|
| |
$—
|
| |
$212,330
|
| |
$212,330
|
| |
$—
|
|
|
TOTAL
|
| |
$501,908
|
| |
$—
|
| |
$1,079,408
|
| |
$501,908
|
| |
$—
|
| |
$1,656,908
|
| |
$1,656,908
|
| |
$—
|
|
|
Tara Mackey
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
Severance
|
| |
$—
|
| |
$—
|
| |
$118,172(9)
|
| |
$—
|
| |
$—
|
| |
$722,942(10)
|
| |
$722,942(10)
|
| |
$—
|
|
|
Short-Term Cash Incentive(3)
|
| |
$198,809
|
| |
$—
|
| |
$198,809
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
|
|
SARs(4)
|
| |
$18,814
|
| |
$—
|
| |
$18,814
|
| |
$18,814
|
| |
$—
|
| |
$18,814
|
| |
$18,814
|
| |
$—
|
|
|
RSUs(5)
|
| |
$467,678
|
| |
$—
|
| |
$467,678
|
| |
$467,678
|
| |
$—
|
| |
$467,678
|
| |
$467,678
|
| |
$—
|
|
|
PSUs(6)
|
| |
$655,281
|
| |
$—
|
| |
$655,281
|
| |
$655,281
|
| |
$—
|
| |
$655,281
|
| |
$655,281
|
| |
$—
|
|
|
TOTAL
|
| |
$1,340,582
|
| |
$—
|
| |
$1,458,754
|
| |
$1,141,773
|
| |
$—
|
| |
$1,864,715
|
| |
$1,864,715
|
| |
$—
|
|
|
69
|
Proxy Statement
|
|
TRIGGERING EVENTS
|
| ||||||||||||||||||||||||
|
|
| |
Termination of Employment Before
Change in Control
|
| |
Termination of Employment Within
Two Years After Change in Control
|
| ||||||||||||||||||
|
|
| |
Death/
Disability
|
| |
Termination
for Cause
|
| |
Termination
Without
Cause
|
| |
Death/
Disability
|
| |
Termination
for Cause
|
| |
Termination
Without
Cause
|
| |
Voluntary For
Good Reason
|
| |
Voluntary
Without
Good Reason
|
|
|
Gary Hill
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
Severance
|
| |
$—
|
| |
$—
|
| |
$550,250(7)
|
| |
$
|
| |
$—
|
| |
$1,100,500(8)
|
| |
$1,100,500(8)
|
| |
$—
|
|
|
Short-Term Cash Incentive(3)
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
|
|
SARs(4)
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
|
|
RSUs(5)
|
| |
$1,430,980
|
| |
$—
|
| |
$1,430,980
|
| |
$1,430,980
|
| |
$—
|
| |
$1,430,980
|
| |
$1,430,980
|
| |
$—
|
|
|
PSUs(6)
|
| |
$546,050
|
| |
$—
|
| |
$546,050
|
| |
$546,050
|
| |
$—
|
| |
$546,050
|
| |
$546,050
|
| |
$—
|
|
|
Life Insurance Benefit(11)
|
| |
$345,000
|
| |
|
| |
|
| |
$345,000
|
| |
|
| |
|
| |
|
| |
|
|
|
TOTAL
|
| |
$2,322,030
|
| |
$—
|
| |
$2,527,280
|
| |
$2,322,030
|
| |
$—
|
| |
$3,077,530
|
| |
$3,077,530
|
| |
$—
|
|
|
Bryan Stovall
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
Severance
|
| |
$—
|
| |
—
|
| |
$181,729(9)
|
| |
$
|
| |
$—
|
| |
$700,000(10)
|
| |
$700,000(10)
|
| |
$—
|
|
|
Short-Term Cash Incentive(3)
|
| |
$192,500
|
| |
—
|
| |
$192,500
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
|
|
SARs(4)
|
| |
$—
|
| |
—
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
|
|
RSUs(5)
|
| |
$376,891
|
| |
—
|
| |
$376,891
|
| |
$376,891
|
| |
$—
|
| |
$376,891
|
| |
$376,891
|
| |
$—
|
|
|
PSUs(6)
|
| |
$361,325
|
| |
—
|
| |
$361,325
|
| |
$261,325
|
| |
$—
|
| |
$361,325
|
| |
$261,325
|
| |
$—
|
|
|
TOTAL
|
| |
$830,716
|
| |
—
|
| |
$1,012,445
|
| |
$638,216
|
| |
$—
|
| |
$1,338,216
|
| |
$1,338,216
|
| |
$—
|
|
(1)
|
This amount is Mr. Ferguson’s base salary for a period of 24 months plus a pro-rated short-term cash incentive payment. Mr. Ferguson’s Second Amended CEO Agreement with the Company provides that if he is terminated without cause, he will be entitled to his base salary for the period from the date of termination to the end of the term of the Second Amended CEO Agreement, but in any case a period of at least 24 months.
|
(2)
|
This amount is 2.99 times the base salary of Mr. Ferguson. Severance benefits for Mr. Ferguson are set forth in his Second Amended CEO Agreement.
|
(3)
|
Assuming a termination date of February 28, 2021, Mr. Ferguson would be eligible to a target annual cash incentive of 100% of his fiscal year 2021 annual base salary. Mr. Schlom would be eligible to a target annual cash incentive of 65% of his annual base salary for fiscal year 2021 and Ms. Mackey and Messrs. Hill and Stovall would be eligible to a target annual cash incentive of 55%.
|
(4)
|
All SARs for the NEOs (if applicable) have vested. The value of the SARs are calculated based upon the difference between the closing price of the Company’s common stock on February 26, 2021, the last previous trading day of $51.09, and the grant date price of $44.15.
|
(5)
|
The value of the accelerated vesting of RSUs, including any dividend equivalents accrued during the vesting period, are calculated based upon the closing price of the Company’s common stock on February 26, 2021, the last previous trading day ($51.09).
|
(6)
|
Pursuant to the 2014 Plan and the accompanying award agreements, the compensation committee in its sole discretion may deem the PSUs be payable at the target amount (i.e., 100% achievement of the performance goals) in the event that the vesting date of such PSUs is accelerated. The value of the PSUs granted during fiscal years 2019, 2020 and 2021, including any dividend equivalents accrued, was calculated using the closing price of the Company’s common stock on February 26, 2021 ($51.09) and assuming that the compensation committee determined that these PSUs were each payable at their respective target amounts.
|
(7)
|
This amount represents Mr. Hill’s and Mr. Schlom’s base salaries for a period of 12 months plus a pro-rated short-term cash incentive payment. Mr. Hill’s and Mr. Schlom’s employment agreements with the Company provide that if they are terminated without cause, they each would be entitled to their base salaries for the period from the date of termination to the end of the term of the employment agreement, but in any case a period of at least 12 months.
|
(8)
|
This amount represents two times Mr. Hill’s and Mr. Schlom’s annual base salaries and target annual cash bonuses. Severance benefits for Messrs. Hill and Schlom are set forth in their employment agreements.
|
(9)
|
The AZZ Inc. Severeance Plan provides guidelines for payment of benefits to eligible employees in the event of an involuntary termination of employement and who do not receive severance benefits under an existing employment agreement. This number represents the severance payment guidelines equal to one week and an additional two weeks of base salary for each year of employment, not to exceed more than 26 weeks of base pay.
|
(10)
|
This amount represents two times the base salary for Ms. Mackey and Mr. Stovall.
|
(11)
|
Term life insurance payable by the Company pursuant to Mr. Hill’s employment agreement.
|
|
70
|
Proxy Statement
|
|
71
|
Proxy Statement
|
•
|
reviewed and discussed the audited consolidated financial statements with management;
|
•
|
discussed with GT the independence of GT and the matters, if any, required to be discussed by PCAOB Auditing Standard No. 1301 “Communications with Audit Committees”; and
|
•
|
received the letter and the written disclosures from GT required by Rule 3520 of the PCAOB.
|
|
| |
AUDIT COMMITTEE
|
|
| |
|
|
| |
Daniel E. Berce (Chairman)
Paul Eisman
Clive A. Grannum
Venita McCellon-Allen
Steven R. Purvis
|
|
72
|
Proxy Statement
|
|
|
| |
February 28,
2021
|
| |
February 29,
2020
|
|
|
Audit Fees(1)
|
| |
$794,011
|
| |
$863,508
|
|
|
Audit-Related Fees
|
| |
—
|
| |
—
|
|
|
Tax Fees
|
| |
—
|
| |
—
|
|
|
All Other Fees
|
| |
—
|
| |
—
|
|
|
Total Fees
|
| |
$794,011
|
| |
$863,508
|
|
(1)
|
Includes fees for services related to the annual audit of the consolidated financial statements, and reviews of our quarterly reports on Form 10-Q.
|
|
73
|
Proxy Statement
|
|
|
| |
|
|
|
|
| |
PROPOSAL 4
RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
|
|
|
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE RATIFICATION OF GT TO SERVE AS THE COMPANY'S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE FISCAL YEAR ENDING FEBRUARY 28, 2022.
|
|
|
74
|
Proxy Statement
|
|
75
|
Proxy Statement
|
1.
|
Head toward South 22nd Ave. on West 32nd St. (183 ft)
|
2.
|
Make a U-Turn onto West 32nd St. (0.1 miles)
|
3.
|
Turn slightly right onto South Service Rd. (1.3 miles)
|
4.
|
Take left ramp onto International Pkwy South (TX-97-SPUR) toward TX-183/TX-360 (0.9 miles)
|
5.
|
Take ramp onto TX-183 West (Airport Fwy) toward Ft. Worth (10.7 miles)
|
6.
|
Continue on I-820 (0.7 miles)
|
7.
|
Keep left onto TX-121 South toward Downtown Ft. Worth (7.1 miles)
|
8.
|
Take the exit toward Downtown/Belknap St. onto East Belknap St. (1.7 miles)
|
9.
|
Turn slightly left onto Energy Way (0.1 miles)
|
10.
|
Turn slightly right onto Summit Ave. (301 ft)
|
11.
|
Turn right onto West 7th St. (1.2 miles)
|
12.
|
Arrive at West 7th St. (One Museum Place) Your destination is on the right.
|
1.
|
Head toward West 6th St. on Taylor St. (124 ft)
|
2.
|
Turn right onto West 6th St. (0.2 miles)
|
3.
|
Turn slightly right onto West 7th St. (1.6 miles)
|
4.
|
Arrive at West 7th St. (One Museum Place) Your destination is on the right.
|
1 Year AZZ Chart |
1 Month AZZ Chart |
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